It seems that the coronavirus outbreak has affected the collection of the Goods and Services Tax (GST) for February 2020. As per the data released, department has collected ₹98,000 crore so far. The government had a target to collect more than ₹1 lakh crores , which in the current situation doesn’t seem to be completed. Although the last date to file GST collections for the month of February, March and April has been extended to 30th June 2020, data reveals that almost all the taxpayers had paid their dues so far.
There is an possibility that reduced GST collections is because of the fact that imports had started reducing from China from the middle of January and remained almost negligible in the entire month of February due to Covid-19 outbreak. Some other factors could also be the reason such as reduced collection from the manufacturing activity in the automobile sector because of the transition from BS IV vehicles to BS VI and the low GDP growth etc. Considering that the GST is a consumption-based tax, all these factors were leading to a reduced consumption having a direct impact on the GST collections.
In the current situation , department is trying to ease the pain of micro small and medium enterprises by ensuring that it processes the pending refunds, to the extent possible,after proper verification. With most businesses being non-operational for a March due to lockdown situation and the relaxation of delayed payments being allowed now , the coming quarter would see considerable fall in collection.