Gujarat growth story plateauing; GST collections show Karnataka, TN growing fast

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By Our Special Correspondent

New Delhi, April 2: Behind the jubilation over Rs 1 lakh crore GST collections of Gujarat lies hidden the sharp decline in the rate of growth. Gujarat is among very few states in the country where the Goods and Services Tax (GST) collections are growing in single digit.

Gujarat netted a total of Rs 1.17 lakh crore GST collections in 2022-23 fiscal, with 17.5 per cent overall growth. But the highly industrialized states in the western parts of the country had lost the coveted second slot in the overall GST collections to Karnataka in October last year. Since then the rate of growth of GST collections in Gujarat has been sloping down.

In contrast the GST collections in some of the southern states such as Karnataka and Tamil Nadu have been growing quite fast, clocking double digit growth. Karnataka continues to occupy the second slot in the monthly GST collections behind Maharashtra, which is way ahead of any states.

Maharashtra, the most industrialized state of India, reported a monthly GST collections of Rs 22695 crores in March this year. The second highest monthly collections came from Karnataka at Rs 10360 crores.

The rate of growth of the GST collection in Gujarat was 8.31 per cent. The state netted Rs 9919 crores in March. Gujarat had reported eight per cent growth rate in February this year, netting a total of Rs Rs 9574 crores. In contrast, Karnataka reported 18 per cent growth rate in the GST collections in February, netting a total of Rs 10809 crores. Tamil Nadu reported a robust 19 per cent growth rate in the GST collection, netting a total of Rs 8774 crores.

Last month also Karnataka and Tamil Nadu reported strong growth rates in the GST collections of 18.24 and 15.20 per cent respectively.

The club of the single digit growth rate in the GST collections in March consisted of Gujarat, Manipur, Himachal Pradesh, Dadra and Nagar Haveli in the month of March. Gujarat was in the company of Himachal Pradesh, Chandigarh, Chhattisgarh, Dadra and Nagar Haveli, Puducherry, and Telangana with single digit growth rate in the GST collections. Even the most industrialized Maharashtra had reported 15 per cent growth rate in the GST collection in the month of February.

The GST collections’ trends clearly show that the southern states are growing rapidly, and there is a definite plateauing in Gujarat, which had reported robust growth in the indirect tax collections till at least September last year.