Breaking News: GST Collections Plummet to a 40-Month Low - What's Behind the Alarming Decline?

Gross GST collections have hit a 40-month low in September 2024, clocking in at Rs 1.73 lakh crore. Although this figure represents a 6.5% year-over-year rise, the growth rate has slowed down, sparking concerns about the underlying causes.

According to data released by the government, the last time GST collections were this low was in January 2022, highlighting the seriousness of the situation. Industry experts point to multiple factors contributing to this downturn, including slackening global demand and economic headwinds domestically.

While government officials attribute the decrease in GST revenue to reduced tax rates on certain essential items, critics argue that the move might not be enough to arrest the slide in tax collections. Moreover, collections from states have been sluggish compared to the Centre's, raising eyebrows over uneven revenue distribution and recovery prospects.

Looking ahead, analysts stress the importance of addressing these weaknesses and undertaking aggressive policy measures to stimulate economic growth and get GST revenues back on track. Whether the present numbers would translate into meaningful policy actions remains to be seen.