After opening the day flat, Share markets in India witnessed selling pressure and are presently trading in the red. Sectoral indices are trading on a mixed note, with stocks in the IT sector and stocks in the auto sector witnessing maximum buying interest. While stocks in the metal sector are leading the losses.
The BSE Sensex is trading down by 140 points (down 0.4%) and the NSE Nifty is trading down by 58 points (down 0.6%). Meanwhile, the BSE Mid Cap index is trading up by 0.2%, while the BSE Small Cap index is trading up by 0.1%. The rupee is trading at 64.84 to the US$.
In news from the Goods and Service Tax (GST) space. GST collections are showing fresh momentum and are seen to close the revenue gap according to the latest numbers.
Average shortfall in GST revenue collected by states narrowed to 24% in September and further to 17.6% in October from a high of 28.4% in August, supporting the optimism of state finance ministers that revenues will stabilize further in coming months.
GST, aimed at creating a common nationwide market by scrapping a web of local taxes, has seen a series of tweaks since it was implemented on 1 July, with the most comprehensive changes announced after a GST Council meeting on 10 November when it cut taxes on as many as 200 items to ease the burden on businesses, relaxed penalties and made it easier for small businesses to comply.
The changes are expected to cost the Union and state governments Rs 200 billion a year.
But even before the latest tax cuts were announced, the combined central and state GST revenues, including cess, recovered from the blip seen in August.
In October, the combined GST revenue was Rs 951 billion, up more than 2% from the preceding month.
State GST receipts rebounded with a growth of over 44% in September from the previous month and increased further by 8.5% in October to Rs 356 billion.
The indirect tax reform held the promise of widening the tax base and make taxation more transparent but the sophisticated IT-driven processing of returns envisaged in GST has made compliance tough for many small businesses, which prompted the GST Council to continue some pre-GST era schemes for exporters and suspend the rigorous matching of invoices from suppliers and buyers till the end of the current fiscal year.
