In the same year, the total GST collection is expected to gross Rs 9,80,807 crore, a growth of just 2.3 per cent compared to 12.1 per cent and 12.3 per cent in 2020-21 and 2021-22, respectively.
The government has estimated a GST collection of Rs 7.61 lakh crore during 2019-20.
"GST Compensation cess will be levied till June, 2022. About 80 per cent amount will have to be collected by way of Cx (central excise)/other. 20 per cent of the amount could be shifted to CGST/SGST from July, 2022 onwards," according to an internal projection made by the Central Board of Indirect Taxes and Customs (CBIC).
In order to make up for loss of revenue to states, Section 7 of the GST (Compensation to States) Act, 2017, provides for compensating them in the initial five years of GST implementation.
Rolled out on July 1, 2017, the new indirect tax system now appears to have stabilised. The total GST collection has been rising month-on-month with the total mop-up touching an all-time high of Rs 1,13,865 crore in April this year.
While the CBIC paper, reviewed by , has not spelt out whether the government will raise rates on certain items, or if new sectors would be brought under the purview of the GST, a senior tax partner said central excise and customs duties could go up after compensation levy goes.
In case the five-year period for levying compensation cess is not extended, many items especially cars and soft drinks will turn significantly cheaper. The government currently levies 28 per cent GST on cars and a compensation cess upto 15 per cent. In case, the compensation cess is removed, cars would become cheaper to that extent.
Experts, however, pointed out that the government is unlikely to permit revenue loss to the exchequer given that it can raise GST rates up to 40 per cent in accordance with the ceiling provided in the legislation.
"It is very difficult to predict as to what will happen then. But an increase in GST rate can not be ruled out once the compensation cess provision comes to an end," said PwC India Partner Pratik Jain.
(Nirbhay Kumar can be contacted at nirbhay.k@.in)
( With inputs from IANS )