E-way bill data point to covid’s blow to consumption

 







Goods and Services Tax (GST) revenue receipt figures for May will likely to show a fall from the record levels seen in April and see a sharper decline in June, suggests the latest e-way bill generation data. GST collection figures are usually released on first of every month.

Tax is collected every month for the sales achieved by businesses in the previous month. Electronic permits generated for goods transportation within and across states, which was at 7.12 crores in March and got reflected in the record Rs1.41 trillion GST revenue receipts for April, reported last month, have since shown a decline. This signals that the restrictions on mobility and economic activity at many parts of the country are beginning to take a toll on tax collections.

E-way bills generated in April at 5.87 crore shows a decline of over 17% sequentially which will reflect in the tax receipts for May. E-way bills generated have further declined sharply by nearly 35% in May to 3.82 crores, indicating the blow to consumption delivered by the devastating second wave of the pandemic.

This points to the challenge the resurgence of the pandemic has posed to India’s economic recovery after a crippling 7.3% contraction in FY21, the worst since independence. It has depressed incomes, prolonged the payment cycles between suppliers and clients and hit labour availability for businesses. Many industry representatives believe that once vaccination levels pick up, businesses will feel more confident about the prospects of operations recovering.

Industry body Federation of Indian Chambers of Commerce & Industry said on Monday citing own survey that business confidence of Indian companies dipped to its lowest in three quarters in May after a decadal high in its previous survey as the second wave of the pandemic hit the country, Mint reported on Monday.

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