How does the Government collect GST?
A certain percentage of tax is levied by the Government of India on the supply of any goods and services and this tax is known as the GST (Goods and Services Tax). This tax is being levied by the government from the beginning to the end of the supply chain i.e. from the manufacturer to the consumer. Also, the GST is being levied by the both central and the state governments of India. The tax charged by the central government is called CGST, (Central Goods and Services Tax), while the tax levied by the state government is known as SGST (State Goods and Services Tax). For example, if 18% of GST is being collected on the supply of any goods or services then the 9% is CGST while the other 9% is SGST. In this way, both the central and the state governments of India collect revenue via GST.
GST Revenue Collection
Soon after introducing GST (Goods and service tax) in 2017, the major revenue collections observed a considerable hike, and the main reason behind it is that the centralization of all taxes made tax evasion difficult and bring in transparency to the Indian taxation system. Before the launch of GST, many taxes with different rates use to apply to different goods and services. Also, it has been observed that many sellers used to charge hidden taxes on certain goods and services. Thus GST proved to be a game-changing initiative by the central government resolving all the discrepancy in the taxation system.
The GST revenue collection for the month of May 2022 was around INR 1,02,485 Crores, which observed an overall increase of 40% from May 2021, when the GST revenue collection was INR 70,951 Crores.
Contact Us