Kolkata: Economists in West Bengal have raised questions over the state government’s claims for getting the higher collection from state goods services tax (SGST) during the next financial year of 2025-25 despite a shortfall in the collection under the same head in 2024-25.
As per the revised estimates for 2024-25, the West Bengal government’s collection from SGST during the fiscal under review was Rs 45,872.52 crore, a figure lower than the targeted collection of Rs 47,336.55 crore as was fixed in the budget estimates for the same fiscal.
However, despite this shortfall in collection in 2024-25, the state government has projected a higher collection from SGST in the budget estimates for 2025-26 at Rs 49,771.98 crore.
Economists said that the only plausible basis for this higher SGST collection target for 2025-26 is the state government’s expectations of a boost in market demand for products and services due to the proposals in the last Union budget to raise the minimum tax slab to Rs 12 lakh from Rs 7 lakh in the new regime, in addition to Rs 75,000 of the standard deduction for salaried taxpayers.
Compared to the figure of SGST collections in the revised estimates for 2024-25, the West Bengal government had projected an 8.5 per cent growth in the same figure in the budget estimates for the same fiscal.
At the same time, economists also believe that following the recent announcement by the Reserve Bank of India for a 25 basis point cut in repo rate thus reducing interest rates on housing and other loans will encourage middle-class individuals to opt for loans to purchase products including four- wheelers, which will again boost the market demand.
They also believe the two developments of raising the minimum tax slabs and cut-in repo rates will surely to an extent shift the focus of the middle class from goods and services attracting lower GST to those attracting higher GST.
(IANS)
