As November 30 approaches, GST officials’ expectation of revenue collection is reaching its peak. E-way bill generation in October has already given very high hopes. The combination of compliance and consumption will likely result in the collection in November either close to an all-time high collection of Rs 1.87 lakh crore (April 2023) or even exceeding that.
Data for GST collection in November is to be made public on December 1
According to new compliance rule, “the taxpayers have to reverse the Input Tax Credit (ITC) availed on such invoice or debit note, the details of which have been furnished by their supplier in their GSTR-1/IFF but the return in FORM GSTR-3B for the said period has not been furnished by their supplier till the 30th day of September following the end of financial year in which the Input Tax Credit in respect of such invoice or debit note had been availed.” Further, the said amount of ITC must be reversed by such taxpayers while furnishing a return in FORM GSTR-3B on or before November 30 following the end of such financial year, as part of this legal obligation. Taxpayers have already been communicated about that.
Experts say this is one of many compliance rules that can push the collection forward. Prateek Bansal, Tax Partner with White and Brief – Advocates & Solicitors, says the higher GST collections are typically directly proportional to the increased consumption of goods/services and robust compliance mechanisms to deter tax evaders. “Various compliances such as reduction in e-invoicing threshold limits, the due date for ITC availment for FY 2022-23, the due date for the annual return for FY 2022-23, stricter norms for matching of ITC before availment, suspension of GST registration for non-filing of returns, etc. are anticipated to garner higher GST collections in November,” he said.
Further, recent amendments to the online gaming industry and a well-knitted risk analysis system leading to timely audits, especially concerning high-risk taxpayers, are some other factors that may lead to an all-time high GST collection in November, added Bansal.
Another key factor is e-way bill generation, whose monthly generation in October surged to 10 crores for the first time since its introduction. This could reflect the festival demand, which necessitated goods to be transported in large quantities. Data from GSTN showed that e-way bill generation touched 10.03 crore, surpassing the previous high of 9.34 crore in August this year.
Experts feel that higher compliance also contributed to high e-way bill generation apart from festival demand. This will have some impact on GST collection for November. It is possible that the movement of goods might have occurred in the same month of consumption or even a month before that, which is why e-way bill generation may have an impact on collection spreading over two months.
“ The GST collections in the next month are expected to be quite robust considering the higher festive season spending and the high e-way bill numbers also point in that direction,” M S Mani, Partner with Deloitt0e, said.
An e-way bill is an electronic document generated on a portal, evidencing the movement of goods and indicating whether tax has been paid. As per Rule 138 of the CGST Rules, 2017, every registered person who causes the movement of goods (which may not necessarily be on account of supply) of consignment value of more than ₹50,000 is required to generate an e-way bill. This is required for movements between the two States and within a State. However, a State or UT, with the legislature, can decide the threshold for the value of goods to be applicable for movement within its boundary.