Haryana beats Punjab with four-fold GST collections

Haryana is developing much faster in terms of infrastructure and is a preferred destination for multinational companies as well as individuals, thereby leading to significant GST collections.

The GST collections of a state depend on various factors, such as the size of the economy, the level of industrialisation, consumer spending patterns, and the tax administration.
At Rs 10,035 crore, the Goods and Services Tax (GST) collection of Haryana is four times that of Punjab's Rs 2,316 crore for April 2023, despite the big brother being home to a larger population of 3.06 crore and sprawled over an area of 50,362 sq km, compared to a population of 2.99 crores and an area of 44,212 sq km for the smaller cousin.

The states with the maximum GST collection include Maharashtra, Karnataka, Gujarat, Tamil Nadu, and Uttar Pradesh, while the northeastern states and union territories rack up the lowest revenue.

Gurugram contributes around 40 per cent of Haryana’s GST collections. The concentration of large corporations in Gurugram drives up Haryana’s GST collections. Punjab's economy is still based a lot on agriculture, which is GST-exempt. Punjab is India’s third-largest foodgrain producer, behind Uttar Pradesh and West Bengal. In 2018, 25 per cent of Punjab’s GDP  came from agriculture, while for Haryana it was 14 per cent

Haryana is developing much faster in terms of infrastructure and is a preferred destination for multinational companies as well as individuals, thereby leading to significant GST collections,

Haryana has a higher consumption of goods and services, which could be the result of higher disposable incomes and a larger middle class. This also leads to higher GST collections as the tax is applied to the consumption of goods and services.

Automation, data analytics, and digital audits in the state of Haryana are helping deter errant taxpayers. Haryana is located in the National Capital Region (NCR) and is surrounded by Delhi, Uttar Pradesh, and Rajasthan, which are all high revenue-generating states. This could lead to a higher flow (and consumption) of goods and services, and therefore higher GST collections

Haryana has about 1.5 times more entities registered with GST authorities than Punjab, but the GST collection is about four times.

States with better infrastructure have been able to attract corporates and reap its benefits.
Haryana has so many big corporates because of its advanced infrastructure and better industrial policies. Punjab and Rajasthan have not been able to develop that kind of infrastructure or support system to attract major investments, resulting in lower GST numbers. If we look at neighbouring states, only UP is on par in terms of growth and revenue collections

GST is a consumption-based tax that is levied at the point of consumption. The GST collections of a state depend on various factors, such as the size of the economy, the level of industrialisation, consumer spending patterns, and the tax administration. Larger states like Maharashtra, Karnataka, Gujarat, and Uttar Pradesh, which have a large populations and more economic activity, consume more goods and services, resulting in higher GST collection.

In states like Tamil Nadu, high employment and literacy means higher purchasing power, which leads to greater consumption, and consequently, higher GST collections. Bengaluru in Karnataka is a hub of the service sector, which again leads to high consumption