E-way bills in July the second highest since 2018

This indicates that the Goods and Services Tax (GST) collections in August could go above INR 1.5 trillion

August 5, 2022

E-way bills generated in July by companies for the inter-state business grew by 18% Year-on-Year (YOY), and 1.5% Month-on-Month (MoM)

The recovery in economic activities has led to more exports

GST collections in July were up by 28% YOY at INR 1.49 trillion and the second-highest ever since the regime was launched

Increased compliance enforcement measures by the government and a recovery in economic activity are factors in the growth of GST receipts

E-way bills generated for inter-state commerce grew by 18% YOY, and 1.5% MoM in July, which indicates that the GST collections in August could go above INR 1.5 trillion, and is the new monthly normal. 

The total number of e-way bills was 75.58 million in July, the second-highest since the system was launched in 2018. The e-way bills’ collection was the highest in March 2022, at 78.16 million, which resulted in gross GST receipts worth INR 1.68 trillion in April 2022.

In FY23, gross GST receipts may surpass the target by INR 3 trillion with a monthly average of INR 1.5 trillion up until July, allowing the Centre to allocate an additional INR 80,000 crore after devolution to the states.

GST collections in July were up by 28% YOY at INR 1.49 trillion and the second-highest ever since the regime was launched, thanks to resurgent economic activities, improved compliance, high inflation and a broadening of the tax base.

The recovery in economic activities has led to more exports. It has also benefited the trucking industry, which is expected to see higher growth in revenues for FY23 at 15-20%, compared to figures from the previous year which was 10-12%, despite a rise in fuel costs. 

The increase in monthly gross GST collections has presented an opportunity for the Centre to recalibrate an action plan on tax rates, as the shortage in GST by States after the end of the compensation mechanism on June 30, could be inadequate.

Increased compliance enforcement measures by the government and a recovery in economic activity are factors in the growth of GST receipts. The upcoming festival season can further boost receipts.

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