Introduction: The Lok Sabha Starred Question No. 18* delves into the intricacies of GST collection and the devolution process for the financial year 2022-23.
Detailed Analysis:
1. Devolution for FY 2022-23:
- A total of 14 installments of devolution to states were released for the fiscal year 2022-23. The shares of Goods and Services Tax (GST) collection for Bihar, Maharashtra, Jharkhand, West Bengal, and Jammu & Kashmir are detailed, indicating the Central GST and SGST collection.
2. Pending Amounts and Installments for FY 2023-24:
- The compensation payable to states for the transition period is released provisionally every two months, with final calculations done at the end of the fiscal year. The balance GST compensation released during the current financial year (2023-24) for Bihar, Maharashtra, Jharkhand, West Bengal, and Jammu & Kashmir is provided, reflecting finalization of provisional compensation for previous fiscal years.
3. GST Collection Trends:
- The upward trend in GST collection since its implementation in July 2017 is evident. April 2023 saw a record-high GST collection of Rs. 1.87 lakh crore. Monthly collections during the current financial year consistently exceed Rs. 1.50 lakh crore. The average gross monthly GST collection for FY 2023-24 stands at Rs. 1.66 lakh crore, indicating an 11% increase compared to the same period in the previous financial year.
4. Composition of GST Collection:
- GST collection comprises CGST, SGST, and IGST. While CGST is credited to the Consolidated Fund of India, SGST is credited to the Consolidated Fund of respective states. IGST, collected by the Centre, undergoes apportionment and settlement between the Union and the States/UTs based on consumption and cross-utilization of Input Tax Credit.
5. Possibility of Increased State Shares:
- The question raises the possibility of states, especially Bihar, Maharashtra, Jharkhand, West Bengal, and Jammu & Kashmir, receiving a higher share of GST collections due to improved collection trends. However, the response does not explicitly confirm such considerations.
Conclusion: The details provided in response to Lok Sabha Starred Question No. 18* offer insights into the complex mechanisms of GST collection and devolution. While the current financial year witnesses positive trends in GST collection, whether states will receive a higher share remains speculative. Understanding the nuances of GST distribution is crucial for states to manage their finances effectively and plan for potential increases in revenue sharing.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
LOK SABHA STARRED QUESTION NO. 18*
TO BE ANSWERED ON MONDAY, THE 04th DECEMBER, 2023 / AGRAHAYANA 13,
1945 (SAKA)
GST Collection
†*18. SHRI SUNIL KUMAR PINTU:
SHRI JUGAL KISHORE SHARMA:
Will the Minister of FINANCE be pleased to state:
(a) the number of installments in which the total amount of share of Goods and Services Tax (GST) collection, payable for the financial year 2022-23 has been released to Bihar, Maharashtra, Jharkhand, West Bengal and Jammu and Kashmir;
(b) whether any amount of GST share payable to Bihar, Jammu and Kashmir, West Bengal and Jharkhand for the previous financial year is pending and if so, the details thereof;
(c) the number of installments released for distribution to Bihar, Maharashtra, Jharkhand, West Bengal and Jammu and Kashmir during the current financial year;
(d) whether there is any possibility that the States particularly Bihar, Maharashtra, Jharkhand, West Bengal and Jammu and Kashmir getting a higher share GST collection in view of the better collection of GST this year and whether the funds are likely to be distributed accordingly; and
(e) if so, the details thereof?
ANSWER
THE MINISTER OF FINANCE
(SMT. NIRMALA SITHARAMAN)
(a) to (e): A Statement is laid on the Table of the House.
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STATEMENT REFERRED TO IN REPLY TO PARTS (a) to (e) OF LOK SABHA STARRED QUESTION NO. 18* DUE FOR ANSWER ON 04th DECEMBER, 2023
(a): A total of 14 installments of devolution to the States was released for the FY 2022-23. The details of share of Goods and Services Tax (GST) collection released for FY 2022-23 is given below: –
(in Rs. Crores)
| State | Devolution of Central GST |
SGST Collection including Regular and Adhoc settlement of IGST |
| Bihar | 26,989.02 | 23,384.21 |
| Maharashtra | 16,950.64 | 1,29,129.40 |
| Jharkhand | 8,873.77 | 11,489.57 |
| West Bengal | 20,186.74 | 39,051.78 |
| Jammu and Kashmir | – | 7,272.22 |
(b) & (c): As per section 18 of the Constitution (One Hundred and First Amendment) Act, 2016, compensation to the States for loss of revenue arising on account of implementation of the goods and services tax is payable for a period of five years. During transition period, the States’ revenue is protected at 14% per annum over the base year revenue of 2015-16. As per the provisions of section 7(2) of Goods and Services Tax (Compensation to States) Act, 2017, enacted by Parliament, the compensation payable to a State shall be provisionally calculated and released at the end of every two months period, and shall be finally calculated for every financial year after the receipt of final revenue figures, as audited by the Comptroller and Auditor General of India. Government of India has already released the entire amount of provisionally admissible GST compensation to all States/UTs for loss of revenue arising on account of implementation of Goods and Services Tax for five years i.e., from 1st July, 2017 to 30th June, 2022. Final Compensation arising out of reconciliation of provisional figures with audited figures is released immediately on receipt of AG’s certificate and no amount other than finalization of compensation is pending for release to the states/UTs. The balance GST compensation released to Bihar, Maharashtra, Jharkhand, West Bengal and Jammu & Kashmir during the current financial year 2023-24 is as under: –
| State | Amount (in Rs. crore) |
| Bihar | 398.19* |
| Maharashtra | 0 |
| Jharkhand | 165.63** |
| West Bengal | 0 |
| Jammu & Kashmir | 0 |
* Finalization of provisional compensation of FY 2020-21 & 2021-22
** Finalization of provisional compensation of FY 2017-18 to FY 2021-22
Further, 8 instalments of devolutions have been released for FY 2023-24 (till November, 2023).
(d) & (e): GST collection has been showing an upward trend year on year basis since implementation of GST w.e.f. 1st July, 2017. GST collection rose to a record high of Rs. 1.87 lakh crore in April, 2023. Further, monthly GST collection during current financial year has crossed Rs. 1.50 lakh crore mark each time till now. The average gross monthly GST collection in the FY 2023-24 now stands at Rs. 1.66 lakh crore and is 11% per cent more than that in the same period in the previous financial year.
GST collection consists of CGST, SGST and IGST. CGST is credited to Consolidated Fund of India (CFI) while SGST is credited to the Consolidated Fund of respective States. IGST is being levied and collected by the Centre. The IGST (Domestic + Imports) so collected is apportioned / settled between the Union and the States/UTs on monthly basis, on the basis of place of consumption and cross utilization of ITC (Input Tax Credit) as envisaged under Goods and Services Tax Settlement of Funds Rules, 2017. For the amount of IGST remaining un-apportioned, provisional/advance settlement is done from time to time on an ad-hoc basis between Centre and States/UTs in the ratio of 50:50 and among the States on the basis of monthly revenue to be protected during that Financial Year.
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