Goods and Services Tax (GST) collection slipped below Rs 1 lakh crore in June for the first time in eight months. The tax mop-up dropped as the second wave of COVID pandemic and resultant lockdowns hit businesses and the economy. 

At Rs 92,849 crore, the Goods and Services Tax (GST) collection is the lowest in 10 months since August 2020, when it was Rs 86,449 crore, official numbers released on Tuesday showed.

The GST collections in June 2021 are primarily for supplies made in May – a month when most States were under different levels of lockdown, reducing business activity. 

With significant relaxations in lockdown and business supplies picking up, the collections should see a definite uptick in the coming months, experts said. 

The gross GST revenue collected in June 2021 was Rs 92,849 crore, of which Central GST was Rs 16,424 crore, State GST was Rs 20,397, Integrated GST was Rs 49,079 crore (including Rs 25,762 crore collected on import of goods) and Cess was Rs 6,949 crore (including Rs 809 crore collected on import of goods), the Finance Ministry said. The mop-up in June 2021 is 2 per cent higher than Rs 90,917 crore collected in June 2020. 

GST collection had remained above the Rs 1 lakh crore mark for eight months in a row and was Rs 1.02 lakh crore in May. However, the collection in June 2021 dropped below Rs 1 lakh crore.

ICRA Chief Economist Aditi Nayar said that despite declining to a 10-month low, the June 2021 GST collections provided a positive surprise. “Overall, the GST collections in the Q1 of FY22 are nearly twice as high as Q1 FY21, highlighting the narrower impact of the State-wise restrictions necessitated by the second wave of COVID-19 in India, as compared to the stringent nationwide lockdown last year. This will buffer the revenue situation of the Centre and the States, which should support a ramping up of expenditure going ahead," Nayar added.