Revenue Mobilisation Current Affairs - 2020

GST Revenue Touches Record High in March

The statement from the Finance Ministry states that GST collections scaled to a record high of Rs 1.06 trillion in March. The revenue collection was Rs 97,247 crore in the month of February.

Record Revenue Mobilisation

  • The record revenue collection was attributed to increased compliance and increase in the number of returns filed.
  • Total gross GST revenue collected in March 2019 stood at Rs 1,06,577 crore of which Central GST is Rs 20,353 crore, State GST is Rs 27,520 crore, Integrated GST is Rs 50,418 crore and cess is Rs 8,286 crore.
  • The number of summary sales returns GSTR-3B filed for the month of February up to March 31 stood at 7.59 million.
  • The GST revenue collection in March 2019 records an impressive 15.6 per cent growth over March 2018 collection of Rs 92,167 crore.
  • The monthly average of GST revenue during 2018-19 stood at Rs 98,114 crore which is 9.2 per cent higher than the previous fiscal.

GST Collections for 2018-19

April 2018: Rs 1.03 lakh crore

May 2018: Rs 94,016 crore

June 2018:  Rs 95,610 crore

July 2018: Rs 96,483 crore

August 2018: Rs 93,960 crore

September 2018: Rs 94,442 crore

October 2018: Rs 1,00,710 crore

November 2018: Rs 97,637 crore

December 2018: Rs 94,725 crore

January 2019 : Rs 1.02 lakh crore

February 2019: Rs 97,247 crore

March 2019: Rs 1,06,577 crore

The increase in revenue collection in the month of March is an indication that the revenue growth has been picking up in recent months, despite various rate rationalisation measures.

Revenue Mobilisation: Interim Budget 2019

The interim budget has announced a slew of welfare measures for farm and rural economy, middle class, realty and housing and the unorganised sector. The burden on the exchequer due to the farm income support scheme PM-KISAN itself comes around Rs 75000 crores. This necessitates the government to explore the avenues to find the corpus to pay for these schemes.

Revenue Mobilisation

The government is exploring the following avenues to fund welfare schemes:

  • Large dividend transfers by the Reserve Bank of India and PSUs to balance the Budget deficit after funding the welfare schemes.
  • The government is expecting Rs 82,911 crore through dividend from banks, financial institutions and the RBI in 2019-20.
  • In 2018-19 the government estimates receipts of Rs 74,140 crore from banks, financial institutions and the RBI, much higher than the budget estimate of Rs 54,817 crore.
  • The government is estimating Rs 53,200 crore as PSU dividend in 2019-20.
  • The government is expecting to raise anywhere between Rs 12,000 crore and Rs 20,000 crore through the CPSE buyback route.

Challenges in Revenue Mobilisation

The revenue from the Goods and Service Tax (GST) for the most part of the year has lagged behind the Rs 1 lakh crore monthly target. The government’s efforts at disinvestments are also not yielding desired results. The government’s planned stake sales in state-run firms are still short of the target.

As a result, the government is heavily dependent on the dividends from state-run firms, financial institutions and the RBI to fund its additional expenditure. The government has pegged dividends at Rs 1.36 lakh crore in 2019-20 which is a 14 per cent rise from an already elevated dividend collection of Rs 1.19 lakh crore in 2018-19.