Congress on Friday criticised the BJP-led Central government for the decline in GST collections, terming it a significant concern. The party called for implementing GST 2.0, as proposed in its 2024 manifesto, alongside income support for the poor and tax relief for the middle class.
In a statement, Congress general secretary Jairam Ramesh said, “The latest data from December 2024 shows that GST collection receipts increased at the second-slowest pace in three and a half years this past month. Net GST collections, after adjusting for refunds, slumped to 3.3% growth—the lowest in FY25. This is concerning news on several fronts.”
Ramesh pointed out that GST collections grew by only 8.6% in the first three quarters of FY25, compared to the 11% growth factored into budget estimates. He cautioned against using this shortfall as a pretext to cut welfare programs like MGNREGA.
December’s moderation in collections includes a 45.3% rise in refunds. While some are legitimate, Ramesh alleged widespread fraud due to GST system loopholes, citing Rs. 35,132 crore in identified fraud with a recovery rate of just 12%.Highlighting GDP growth slowing to 5.4% in Q2 FY25 and stagnant rural wages, Ramesh said India is trapped in a cycle of “low consumption, low investment, low growth, and low wages.”
Address economic distress in the upcoming Union Budget with income support and tax relief.
Replace the existing GST with a simplified GST 2.0, as outlined in the Congress’s 2024 election manifesto.
End “tax and investigative agency terrorism” to encourage private investment and curb the exodus of entrepreneurs.
Ramesh emphasised the need for structural reforms, saying, “The government must shift focus from taxing popcorn to addressing deeper economic issues.”
Highlighting GDP growth slowing to 5.4% in Q2 FY25 and stagnant rural wages, Jairam Ramesh said India is trapped in a cycle of “low consumption, low investment, low growth, and low wages.”