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The Goods and Services Tax Council decision to reduce tax rate on 178 items in November has already shown its impact on state government's tax collections in December. Dipak M Bandekar, Commissioner of Commercial Taxes, informed that tax collections for December so far have been on the lower side compared to December 2016.
Bandekar explained, "Till December 28, we have collected Rs 110 crore on account of state government's share in GST (SGST), Rs 67 crore on account of IGST (inter-state GST) and another R
The Goods and Services Tax Council decision to reduce tax rate on 178 items in November has already shown its impact on state government's tax collections in December. Dipak M Bandekar, Commissioner of Commercial Taxes, informed that tax collections for December so far have been on the lower side compared to December 2016.
Bandekar explained, "Till December 28, we have collected Rs 110 crore on account of state government's share in GST (SGST), Rs 67 crore on account of IGST (inter-state GST) and another R
s 83 crore as value-added-tax (VAT) on petroleum and alcohol. Put together, from all these taxes we have collected Rs 260 crore till December 28. This is lower than our tax collections of Rs 269 crore in December 2016 during the earlier tax regime."
Although the data on tax collections from December 29 to 31 is still awaited, it is unlikely to be more than last year for the same month (December). The December collections actually pertain to trade, which happened in November.
It must be appreciated that the GST reduction was effective from November 16. This means that GST collection for the first half of November was at higher tax rate and the impact of reduction was felt only in the second half.
Bandekar expects that in the coming months the impact of GST reduction on state's tax collections will be more pronounced. He continued, "We had collected Rs 115 crore as SGST in November. Compared to that, December SGST collections of Rs 110 crore are on the lower side."
In November, the GST Council had reduced the GST rate on all restaurants to 5% except for those in luxury hotels. Prior to this move, GST rate was 18% for air-conditioned (AC) restaurants and 12% for non-AC restaurants.
Clearly, the restaurants were a major beneficiary of this reduction, but this move has badly impacted state government's tax collections. This is particularly because Goa has a very high number of restaurants and hotels being a tourism state. The timing of the GST cut - in November, when the tourism season starts - did not bode well for Goa's finances either.
Although the data on tax collections from December 29 to 31 is still awaited, it is unlikely to be more than last year for the same month (December). The December collections actually pertain to trade, which happened in November.
It must be appreciated that the GST reduction was effective from November 16. This means that GST collection for the first half of November was at higher tax rate and the impact of reduction was felt only in the second half.
Bandekar expects that in the coming months the impact of GST reduction on state's tax collections will be more pronounced. He continued, "We had collected Rs 115 crore as SGST in November. Compared to that, December SGST collections of Rs 110 crore are on the lower side."
In November, the GST Council had reduced the GST rate on all restaurants to 5% except for those in luxury hotels. Prior to this move, GST rate was 18% for air-conditioned (AC) restaurants and 12% for non-AC restaurants.
Clearly, the restaurants were a major beneficiary of this reduction, but this move has badly impacted state government's tax collections. This is particularly because Goa has a very high number of restaurants and hotels being a tourism state. The timing of the GST cut - in November, when the tourism season starts - did not bode well for Goa's finances either.
