Tax revenues from merchandise imports rose 30% year-on-year, according to a statement by the finance ministry on May 1. Those from domestic transactions, along with service imports, increased by 17%, it said.
“Even though the spike in April’s GST collections partly benefits from year-end adjustments, the all-time high magnitude of inflows is very enthusing, and augurs well for a robust year-on-year growth in the months ahead as well,” Aditi Nayar, chief economist of credit rating agency ICRA, told The Hindu newspaper.
In the aftermath of the Ukraine war, crude oil prices have risen exponentially – from $82 a barrel in October to $112.8 a barrel in March. This has impacted the prices of petrochemicals, which are the key raw materials for industries such as pharmaceutical packaging, automobiles, paint, polyester and synthetic rubber.
“This trend will continue as long as petroleum products remain under pressure as fuel prices translate into input costs in various sectors such as transport and feed into the retail level,” DK Srivastava, chief policy advisor at EY India told the Mint newspaper in April.
Apart from significant input costs for producers, experts have attributed the record collections to tighter input tax credit regulations.
This article first appeared on Quartz.