Over the past three years, Telangana has experienced steady double-digit growth in GST collections. In 2023, the state recorded a 13% increase in April, which surged to 33% in September, highlighting a strong recovery following the pandemic.
Hyderabad: In a worrying trend for Telangana’s economy, the State’s GST collections for September 2024 registered a meagre 0.78 per cent growth compared to the previous year – a stark contrast to the 33 per cent growth seen in September 2023 over its previous September 2022. This sharp decline raises concern over a broader slowdown in revenue growth.
Over the last three years, Telangana had enjoyed consistent double-digit growth in GST collections. In 2023, the State saw a 13 per cent increase in April, which surged to 33 per cent in September, showcasing a robust post-pandemic recovery. The trend continued throughout 2023, with overall growth rates maintaining a double-digit. However, 2024 tells a different story. While collections in April and May still showed a healthy 11 per cent increase, the momentum slowed significantly from June onward. By September 2024, the State could barely manage a 0.78 per cent growth.
The stark difference between 2023 and 2024 is particularly alarming. While September 2023 collections soared from Rs.3,915 crore to Rs.5,226 crore in 2022, a substantial 33 per cent leap, 2024 saw a near stagnation, with collections at Rs.5,267 crore, a mere Rs.41 crore increase from the previous year.
Economists point out that the sharp dip in GST growth could be a result of several factors, including weakening consumer demand, stagnant industrial growth and reduced private investments. The only sector that seems to be performing well was excise sales, which raises concerns about the government’s ability to spur growth in other key sectors.
Reacting to this, BRS working president KT Rama Rao blamed the Congress government for Telangana’s sharp economic downturn, attributing the decline to its “Bulldozer Raj” policies. He noted that the State’s Goods and Services Tax (GST) collections, which had consistently grown by at least 15 per cent year-on-year under BRS regime, had plummeted to less than one percent in September this year.
“Telangana has gone from being a thriving State to now competing with Uttar Pradesh’s economy. The State achieved the unimaginable feat of being in the last position in GST collections with its destructive policies,” he remarked.
Rama Rao said the only sector showing growth in the State was liquor sales which speaks volumes about the government’s priorities. He felt that the Congress had “special talent” to destroy a perfectly thriving economy like Telangana. “I hope the Chief Minister has answers for this (economic collapse),” he posted on X.
With GST collections being a key indicator of economic health, Telangana’s stagnating growth indicates an urgent need for corrective measures to revitalise the State’s financial trajectory.
FOR INFOGRAPH:
Telangana GST Collections (Rs in crores):
Month =========== 2022 ======= 2023 ======= Growth (%) === 2024 ======= Growth (%)
April ———– 4,955 —— 5,622 —— 13 ———– 6,236 —— 11
May ————- 3,982 —— 4,507 —— 13 ———– 4,986 —— 11
June ———— 3,901 —— 4,681 —— 20 ———– 4,716 —— 0.74
July ———— 4,547 —— 4,849 —— 7 ———– 4,940 —— 2
August ———- 3,871 —— 4,393 —— 13 ———– 4,569 —— 4
September ——- 3,915 —— 5,226 —— 33 ———– 5,267 —— 0.78
