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INDIAN PUBLIC FINANCE
Impact of GST on Subsumed Indirect Tax Revenues
Div 1- GROUP 13
Submitted by-
Agnes V Philip BECO22106
Anish Phatak BECO22111
Navya Rastogi BECO22140
Sakshi Ahuja BECO22156
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Abstract
India's tax system is federal. Taxes are collected by the federal government, states, and local governments
by the Constitution's framework, namely the seventh schedule. India's indirect tax system underwent a
significant overhaul on July 1, 2017, when the Goods and Services Tax (GST) was implemented. It was
designed to create a single market and replace several tax systems. It is a multi-tiered system that
increases compliance, broadens taxes, and removes cascading taxes. This study has primarily examined
the effects of the GST on the subsumed indirect tax revenues at the central level of indirect taxes, taking
into account several other factors and policy consequences while also looking at trends in revenue growth
both before and after the implementation of the GST implementation while taking into account several
additional variables and the effects of policy. Descriptive statistics, graphical visualization, and Regression
analysis are the statistical techniques we utilized in this paper to primarily investigate the link between tax
income and subsumed indirect tax revenues, or GST. It sheds light on the GST's wider fiscal and
economic ramifications in India.
Introduction
GST is a multi-staged, destination-oriented tax imposed on every value addition, replacing multiple
indirect taxes. It has marked a pivotal reform in India’s indirect tax landscape, aimed at streamlining the
complex tax structure and fostering a unified national market.
Indirect tax revenues happen to be major sources of funds for central and state governments for funding
infrastructure, health, and education, among many others. Revenue generation was a very important
metric with which to measure the success of GST. In itself, an important goal in structuring GST was that
of widening the tax base by including previously unregistered businesses and informal sector activities
under its tax purview. However, the steady revenue growth under GST was a challenge, mainly in terms of
tax compliance rate adjustments and the rather complex process of implementing dual GST across the
states.
This has direct implications for India's fiscal federalism as IGST collected by the central government is on
sales made between states, while SGST is earned by each state on sales happening within the states.
Revenue distribution between states and the center is a crucial consideration, especially for states that
previously relied on their tax autonomy and now depend on GST compensation grants from the center.
Furthermore, the fluctuating revenue patterns since GST’s implementation highlight the need for ongoing
reforms and compliance measures, including anti-evasion mechanisms and improved administrative
processes, to ensure that GST fulfills its potential as a stable and growing revenue source.
Understanding the revenue impact of GST offers valuable insight into its success in achieving fiscal
sustainability, fostering economic growth, and enhancing India’s competitiveness in the global market. It
also underscores the challenges of balancing central and state financial needs within a unified tax system,
making revenue performance an essential measure of GST’s broader economic impact.
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Objectives:
● To access the impact of GST implementation on the indirect subsumed tax revenue
● To identify if there is any change in growth rate pre-GST and post-GST
Literature Review
Analyzing the Impact of GST on Tax Revenue in India: The Tax Buoyancy Approach, Udai Lal
Paliwa(2019): To eliminate interstate trade obstacles, the GST substituted a centralized system for several
indirect taxes, including state-level VAT, excise, and service taxes (IBEF, 2017). Because states have
different fiscal needs, it is difficult to apply a consistent tax across India's heterogeneous economy,
according to scholars like Jain (2018). The GST's multi-slab structure was a compromise that addressed
these disparate needs while streamlining the tax system. When assessing tax reforms, tax buoyancy—a
metric that gauges how responsive tax revenue is to GDP growth—is essential. As observed in OECD
countries by Girouard and Andre (2005), who connected high buoyancy with fiscal sustainability, a
buoyancy greater than one indicates a responsive tax structure. However, Upender (2008) discovered a
drop in buoyancy in India following reforms, which raised long-term growth in revenue. Dwivedi and
Sinha (2017) emphasized the significance of revenue elasticity, pointing out that indirect taxes account for
a significant portion of state revenue. In line with the government's economic stimulus objectives, Paliwal,
Saxena, and Pandey's (2019) study revealed a minor drop in buoyancy after the GST, from 1 to 0.96,
which may indicate a less onerous tax burden on consumers and businesses.
The model's output reveals both its strengths and weaknesses. Even while VAT by itself has a little effect
on tax revenue, when GST is applied in tandem with VAT, a favorable response occurs, indicating that
VAT may not have sufficiently streamlined the tax structure to improve buoyancy on its own. Seidman's
(2013) demand for complete changes that guarantee sufficient revenue without escalating inequality is
supported by the large positive interaction between VAT and GST (VAT GST), which suggests that their
combined effect has a more substantial impact. In India's varied economy, which is characterized by a
sizable informal sector and income inequality, this is vital. There is little empirical study on the GST's
long-term implications on revenue growth and fiscal stability in India, despite the literature's theoretical
benefits. Using a tax buoyancy strategy, this study addresses that gap, examining GST's impact on tax
responsiveness and offering policy recommendations to stabilize revenue across economic cycles.
A Comparative Study Of Indirect Tax Revenue: Pre-GST And Post-GST, Prof Somesh Kumar
Shukla(2022): The impact of GST on India's indirect tax income, both before and after it was
implemented, is thoroughly examined in this article, with particular attention paid to the revolutionary role
of digitization and compliance tools like e-way billing and e-invoicing. The goals of the GST are covered
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by Garg (2014) and Pinki et al. (2014), with special attention to the dual GST system that was created to
solve the problems of national and state tax collection. They contend that by eliminating interstate tax
barriers, GST streamlines tax procedures and promotes economic growth for both producers and
consumers. The analysis highlights how digital initiatives like electronic returns, e-way bills, and
e-invoicing, which lower manual errors and expedite regulatory procedures, can help GST promote
transparency and compliance. It cites Munde & Chavan (2016), Sehrawat & Dhanda (2015), and Shaik et
al. (2015) to demonstrate how digital systems lessen inefficiencies in the tax structure.
It concludes by saying that GST, while a transformative policy, initially faced challenges due to the global
pandemic and system adaptation issues. Nonetheless, it has led to a significant increase in revenue
collection through improved compliance and digital transformation, affirming the positive long-term
impact of GST on India's indirect tax revenue.
GST dynamics in India: Exploring state revenue trends, GDP impact, and economic resilience, Iti
Dandona(2024): The paper identifies and analyzes the state-wise variations in the contributions of states
to GST collection across India and discusses differences in revenue growth rates before and after GST
implementation. Data were collected by an extensive review of tax policies, economic indicators, and
fiscal reports, and statistical tests must have been carried out to assess the relationship between tax
structure, revenue, and GDP.
The overall growth trends in GST collections can be observed from FY 2018 to FY 2023 but declined by a
small percentage during FY 2024. Thus, this indicates an overall upward trend over this period but reflects
achievement along with challenges in terms of GST revenue stability and sustainability. State-wise
analysis of GST contributions underlines how different fiscal contexts present variations across regions
and may need different kinds of policy adjustments.
Regional differences should be addressed so that the GST framework can be robust enough. Policymakers
must, therefore, try to make strategies that would solve the revenue challenges of individual states and, at
the same time, promote the broader sustainability of India's GST system
A Study On Comparative Analysis of GST Revenue, Neeta Subhash Sharma(2020): it focuses on an
exploratory research approach with secondary data from the best available sources to explore GST
revenue trends.
The key objective of the analysis is to understand the trend in GST and its implication on the Indian tax
scenario. Results indicate that after implementation, GST collections exhibit an upward trend, showing
that GST has contributed to the growth of revenue in recent years. Consolidation of previously fragmented
indirect tax structures has streamlined processes, improved transparency, and holds promise for continued
revenue generation.
In a study on the impact of GST after its implementation, Milandeep Kour(2016): Highlights the expected
benefits of GST like, boost in GDP, growth in tax collection of states in India, easier tax compliance for
businesses and consumers, and mainly avoidance of tax cascading effect. It emphasizes the challenges that
the government would face during GST implementation, like, the requirement of advanced IT software,
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the cooperation required by state governments and union governments for revenue sharing, and the effect
of GST on the price of consumer goods.
Revenue Implications of GST Rates Restructuring in India: An Analysis, Sacchidananda
Mukherjee(2021): In this paper, Mukherjee has studied the potential Revenue outcomes of restructuring of
GST rates, to solve the problem of recent shortfall since GST implementation. He pointed out the
inefficiency of India's multi-rate GST structure, and complicated Compliance procedure, which led to
revenue shortfall (drop in effective tax rate from 15.5% to 11.6%). He emphasized a simpler tax
compliance system with fewer tax slabs to improve the efficiency of tax administration.
Mukherjee considered six scenarios in his analysis to study the revenue impact of GST and concluded that
the three-tier rate structure with 8%, 15%, and 30% tax rates will lead to revenue neutrality. This paper
contributes to policy discussions in the development of India's GST system by making compliance simple,
reducing administration costs, also providing consistent revenue generation.
Tax Revenue in India: Trends and Issues, Pratap Singh(2019): It studies the progress of India’s tax
structure, the challenges faced, and the reforms made over the last 30 years. India's taxation system has
seen significant reforms since the 1991 crisis, followed by recommendations of the Father of Taxation,
Raja Chelliah. His reforms made India's taxation system simpler and led to easier compliance. Singh
discussed studies by OECD, IDB, and ADB to highlight India's tax-to-GDP ratio compared to other
countries. It is found that India is heavily dependent on indirect taxes, and the share from income taxes is
lower than in many other countries.
Singh has pointed out key obstacles that impact the tax productivity of India, such as tax evasion and
insufficient tax base. He suggests that additional reforms are required to improve efficiency. In his
analysis, it is found that tax collections are growing at a slower rate than the economic growth rate, which
means that there are significant gaps in tax enforcement and policymaking. Singh suggested that India
should match its tax administration with global standards for efficient and sustainable growth.
Methodology
A mixed-methods strategy was used in this work, integrating data visualization with statistical analysis. To
isolate the impact of GST on the central government's revenue stream and prevent confusion with
state-level tax changes, data values on subsumed indirect tax revenues are calculated by only taking into
account customs, union excise duties, and service tax. Sales tax is not included. The balance of payments
revenue budget and Trading Economics' GDP growth, inflation, trade balance, and unemployment were
the sources of the data. The pre-GST and post-GST eras were compared using descriptive statistics to find
changes in growth rates and revenue trends. To separate the effects of GDP growth, inflation, and
unemployment on tax collections, a multiple regression analysis was performed, and the second regression
with the important variables to assess the model's robustness. To better visualize the data, we also made
box plots, bar graphs with trendlines, and correlation heatmaps to examine the links between variables and
spot noteworthy changes before and after the GST was implemented. This thorough approach offers a
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thorough analysis of the effects of GST on the Indian indirect tax revenue system by utilizing these
secondary data sources.
SUMMARY STATISTICS for the Pre-GST and Post-GST period
Pre-GST Period (2011-2017)
With a mean of 495,432.67 and a standard deviation of 129,267.05, the subsumed indirect tax revenue
shows moderate variability. With a minimum of 342,720 and a maximum of 709,508, it demonstrated a
significant rise over time. Although subsumed indirect tax revenue increased steadily, the variation points
to possible volatility brought on by shifting policies or economic conditions during this time.
GDP increase: The mean of 11,793.41 shows a strong rate of increase, while the standard deviation of
2,637.42 shows that economic growth is somewhat volatile. There were significant variations, with the
minimum being 8,508.17 and the greatest being 15,415.66. Indirect tax collections may have been
impacted by the uneven economic growth that reflected various economic cycles.
The range of inflation is 4.91% to 10.02%, with a mean of 7.49%. Increased average inflation indicates
that there were economic pressures at the time, which would have affected indirect tax income as well as
consumer behavior.
Trade Balance: A trade deficit is indicated by the mean of 442.85, which fluctuates moderately (standard
deviation of 177.63). Given that imports typically have an impact on indirect tax collection, a sustained
trade deficit may have affected the revenue base and indirect tax revenues.
The mean unemployment rate is 5.41%, with little fluctuation. Despite possible constraints on economic
growth, stable unemployment rates indicate a generally stable labor market.
Post-GST Period (2017-2023):
With a mean of 667,902.29 and a standard deviation of 179,969.64, the subsumed indirect tax income
shows larger revenue and more fluctuation than it did before the GST. Range: The lowest was 442,562,
while the highest was 956,600. The average indirect tax income increased over the GST period, although
there were more notable variations. This could be because of changes in the way the GST was
implemented, modifications to the economy, and more responsiveness to the overall state of the economy.
GDP Growth: Average growth was higher at 21,854.99, but variability was also larger, as seen by the
higher standard deviation of 4,085.17. Range 17,260.17 is the minimum and 27,152.42 is the maximum.
Though increasing variability may be a symptom of new economic challenges and adjustments following
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the implementation of the GST, economic growth was much higher after the GST, suggesting a rising
economy.
The average rate of inflation is 5.27%, which is less volatile than it was before the GST. The economy's
stability or changes as a result of the GST's simplification of the tax system may be reflected in the lower
average inflation after the tax.
Compared to the pre-GST period, the trade balance's mean of -601.70 indicates a higher trade deficit with
more fluctuation. Increased imports or a stronger reliance on foreign goods could be indicated by the
growing imbalance, which could have an impact on tax income and overall economic stability.
The mean unemployment rate is 6.82%, which is significantly higher than it was before the GST and more
variable. The increased unemployment rate can be a sign of structural changes in the labor market
following the introduction of the GST, reflecting possible job changes or financial difficulties that the
labor market encountered.
In summary, the average indirect tax revenue increased throughout the post-GST period, indicating that
the GST reform had a beneficial impact on revenue generation. But there is also more economic volatility
throughout this time, especially in terms of GDP growth, trade balance, and unemployment rates. This
fluctuation may be a result of continuous macroeconomic modifications to the GST. The pre-GST era, on
the other hand, saw slower revenue growth but comparatively more steady unemployment and inflation.
According to this data, the introduction of the GST may have raised indirect tax income, but it also
resulted in more significant economic adjustments and variations in important economic indices.
Correlation of Total_Subsumed_Indirect_Tax_Revenue with each independent variable:
Year 0.842753
GDP_Growth 0.877143
Inflation -0.228396
Post_GST 0.506918
Trade_Balance -0.270020
Unemployment 0.730060
The correlation study shows that `Total_Subsumed_Indirect_Tax_Revenue` has a strong positive
correlation with Year (0.843) and GDP Growth (0.877), suggesting that tax revenues increase significantly
over time and with economic growth. This indicates that rising government tax revenue is closely tied to
economic expansion. Inflation (-0.228) and Trade Balance (-0.270) have a weak negative association with
tax revenue, implying that a larger trade deficit and higher inflation may slightly reduce revenue, likely
due to lower consumer purchasing power.
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Post-GST, there is a moderately positive correlation (0.507), indicating improved tax compliance or a
broader tax base. Interestingly, a strong positive correlation (0.730) with Unemployment may reflect
structural factors or government revenue systems that sustain tax collection despite high unemployment.
Overall, GDP Growth and Year emerge as the strongest positive drivers of tax revenue, with Inflation and
Trade Balance showing weaker associations. Further analysis is suggested to better understand the
relationship between tax revenue and unemployment.
Average annual Growth rate of total subsumed indirect tax revenues
This is the total revenue from indirect taxes subsumed under GST for both Pre and post-GST periods from
2012 to 2023. By combining several indirect taxes into one, the GST was introduced in India to streamline
the tax system. According to our data, the average annual growth rate (AAGR) of subsumed indirect tax
collections was 16.03% before the introduction of the GST and decreased to 14.59% following it. This
minor decline points to a time of initial adjustment when companies got used to the new tax structure.
Although growth slowed somewhat, the unification of taxes under the GST probably set the stage for
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long-term gains in efficiency and compliance, indicating that even though short-term growth slowed, the
GST could eventually promote a more stable and efficient revenue structure.
Dataset Overview
This dataset provides a comprehensive look at various economic indicators over 13 years from 2011 to
2023, specifically examining their influence on the total subsumed indirect tax revenue in India. It
encompasses several key variables that shed light on the economic landscape, including GDP growth,
inflation, GST implementation, and trade balance.
Variables
1. Total Subsumed Indirect Tax Revenue
Definition: This variable captures the total revenue generated from indirect taxes that have
been incorporated into the Goods and Services Tax (GST) framework. Essentially, it reflects
the government’s earnings from indirect taxation after the implementation of GST.
Type: Dependent variable (Y). Unit: Currency (e.g., Indian Rupees)
2. GDP Growth
Definition: This variable represents the annual percentage increase in India's Gross Domestic
Product (GDP). It serves as a crucial indicator of the country's economic performance and
growth rate, helping us understand how well the economy is doing over time.
Type: Independent variable (X). Unit: Percentage (%)
3. Inflation
Definition: This variable reflects the rate at which the overall prices of goods and services
rise, resulting in a decrease in purchasing power. It is commonly measured using the
Consumer Price Index (CPI) or the Wholesale Price Index (WPI).
Type: Independent variable (X). Unit: Percentage (%)
4. GST Implemented
Definition: This variable acts as a binary indicator (0 or 1) to signify whether the Goods and
Services Tax (GST) has been implemented during a particular year. It plays a key role in
analyzing how GST impacts indirect tax revenue.
Type: Independent variable (X). Unit: Binary (0 = No, 1 = Yes)
5. Trade Balance
Definition: This variable indicates the difference between a country’s exports and imports of
goods and services. A positive trade balance reflects a surplus, whereas a negative balance
shows a deficit, providing insight into the country’s economic health.
Type: Independent variable (X). Unit: Currency (e.g., Indian Rupees)
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Overall Trend:
The chart shows a clear upward trend in Total Subsumed Indirect Tax Revenue over the years 2011 to
2023. This suggests that the government's revenue from indirect taxes has been increasing steadily during
this period.
While the overall trend is upward, there are notable year-to-year fluctuations in the tax revenue. Some
years show significant increases, while others show smaller increases or even slight decreases. This
variability might be due to various factors such as economic cycles, changes in tax policies, and external
shocks.
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The box plot visually compares the distribution of Total Subsumed Indirect Tax Revenue before and after
the implementation of GST. The x-axis represents the GST implementation status (0 = Pre-GST, 1 =
Post-GST), and the y-axis represents the Total Subsumed Indirect Tax Revenue.
Pre-GST (0):
● The median tax revenue before GST implementation is around 500,000.
● The box extends from approximately 420,000 to 550,000, indicating the middle 50% of the data falls
within this range.
● There are two outliers below the lower whisker, suggesting that there were instances of significantly
lower tax revenue in some years before GST.
Post-GST (1):
● The median tax revenue after GST implementation is significantly higher, around 750,000.
● The box extends from approximately 550,000 to 800,000, indicating a wider range of tax revenue
values compared to the pre-GST period.
● There are no outliers above the upper whisker, suggesting that there were no exceptionally high tax
revenue years after GST.
The box plot reveals that the implementation of GST has had a positive impact on Total Subsumed
Indirect Tax Revenue. The median tax revenue has increased significantly, and the overall range of
values has widened. This suggests that GST has stabilized and increased tax revenue, although most
importantly, the average annual growth rate of tax revenue has not increased, which is the key of our
research question. We explain it using regression here.
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Regression Results and Analysis
Hypothesis on the Contribution of Subsumed Taxes
Null Hypothesis (H0): The contribution of subsumed taxes to total indirect tax revenue is the same in the
pre-GST and post-GST periods.
Alternative Hypothesis (H1): The contribution of subsumed taxes to total indirect tax revenue is
significantly different in the post-GST period compared to the pre-GST period.
T test
T-statistic: -1.9508026208882412
P-value: 0.07701223302279323
Fail to reject the null hypothesis: There is no significant difference between the two groups.
● Regression Equation:
Total Subsumed Indirect Tax Revenue = β0 + β1⋅GDP Growth + β2⋅Inflation + β3⋅Trade Balance +
β4⋅Unemployment + β5⋅GST_Implementation + ϵ
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Model Fit:
● R-squared: The model explains 95.6% of the variance in the total subsumed indirect tax revenue,
which is a very strong fit.
● Adjusted R-squared: 92.5%, which is also high and indicates that the model fits the data well after
adjusting for the number of predictors.
● F-statistic: The value of 30.76 and its associated p-value (0.000127) indicate that the model as a
whole is statistically significant.
Coefficients and Statistical Significance:
● Constant: The coefficient of the constant is 3777.19, but it is not statistically significant (p = 0.969),
meaning this value does not provide useful information to predict the dependent variable.
● GDP Growth: The coefficient is 46.1811, and it is statistically significant (p < 0.0001). This suggests
that for each unit increase in GDP growth, total subsumed indirect tax revenue is expected to increase
by 46.18 units, all else being equal. This indicates a strong, positive relationship between GDP
growth and tax revenue.
● GST Implementation: The coefficient is -264,600, and it is statistically significant (p = 0.002). This
negative relationship indicates that the implementation of GST leads to a decrease in subsumed
indirect tax revenue, possibly due to changes in tax structure, rates, or compliance issues. The
magnitude of the coefficient suggests a significant reduction in revenue due to GST.
● Inflation: The coefficient for inflation is 2938.7795, but it is not statistically significant (p = 0.724).
This suggests that inflation does not have a meaningful impact on subsumed indirect tax revenue in
this model.
● Trade Balance: The coefficient is 37.4469, but it is also not statistically significant (p = 0.591).
This implies that the trade balance does not have a significant impact on the total tax revenue.
● Unemployment: The coefficient is -10,780, and it is not statistically significant (p = 0.657). This
suggests that unemployment does not significantly affect the total subsumed indirect tax revenue.
Multicollinearity:
● Variance Inflation Factor (VIF) values help identify potential multicollinearity issues. A VIF value
above 10 suggests a problem with multicollinearity, and some of your VIF values are concerning:
○ GDP Growth: 6.53 – This is within a reasonable range, though high for typical regression
models.
○ GST Implementation: 3.95 – This is acceptable.
○ Inflation: 1.61 – No concern here.
○ Trade Balance: 1.29 – No concern here.
○ Unemployment: 3.65 – This is acceptable as well.
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○ Constant: 48.66 – This unusually high VIF suggests that multicollinearity could be an issue
due to interactions with other variables, or it might indicate numerical problems with the
model's stability. This warrants further examination.
Here is a more refined model for our research question
● Refined Regression Equation:
Total Subsumed Indirect Tax Revenue = β0 + β1⋅GDP Growth + β2⋅GST_Implementation + ϵ
Regression Analysis of Total Subsumed Indirect Tax Revenue
Model Fit and Key Findings
The results of our Ordinary Least Squares (OLS) regression model demonstrate a strong fit, with an
impressive R-squared value of 0.952. This means that around 95.2% of the variation in Total Subsumed
Indirect Tax Revenue can be explained by GDP Growth and the GST Implemented dummy variable. Such a
high R-squared value indicates that these predictors play a crucial role in understanding changes in tax
revenue.
Both independent variables show meaningful relationships with the dependent variable:
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GDP Growth has a positive coefficient of 43.90 (p < 0.001), indicating that for every unit increase in
GDP Growth, we can expect tax revenue to rise by 43.9 units, assuming all other factors remain constant.
This highlights the importance of economic growth in driving tax revenue.
GST Implemented has a negative coefficient of -269,300 (p < 0.001). This suggests that there was a
substantial drop in tax revenue after implementing GST, even when controlling for GDP Growth. This
decrease might point to a significant shift in how tax revenue is collected under the new GST framework.
Multicollinearity Analysis
we found a correlation of 0.841 between GDP Growth and the GST-implemented variable, which is quite
high. The Variance Inflation Factor (VIF) values for both predictors are 3.42, indicating moderate
multicollinearity. While these values are below the typical threshold of 5, they suggest that there is some
overlap in how these variables explain changes in tax revenue.
Model Diagnostics
Residual Normality: The results from the Omnibus and Jarque-Bera tests yielded p-values greater than
0.05, indicating that the residuals are approximately normally distributed.
Autocorrelation: The Durbin-Watson statistic is 2.195, suggesting that there is no significant
autocorrelation in the residuals. This finding reinforces the validity of our model's results.
Interpretation
Impact of GDP Growth: Both analyses reveal a clear positive relationship between GDP growth and
subsumed indirect tax revenue. This finding aligns with established economic theory, which suggests that
as economic activity increases, tax revenues typically rise as well. In other words, a growing economy
generally translates to more tax income for the government.
Effect of GST Implementation: The results from the OLS regression indicate a significant negative
impact of GST on tax revenue, prompting important questions about the effectiveness of GST in boosting
overall tax collections. This suggests that at least within the years studied, the implementation of GST did
not result in any substantial shifts in tax revenue trends.
Conclusion
GST implementation changed the dynamics of India's indirect tax structure on the Central level . It was
observed that while GST simplified taxation and made tax compliance easier, the average annual growth
rate of indirect tax revenue decreased initially, possibly because it was difficult for businesses to adapt to
this new tax system. Our analysis indicates a strong relationship between GDP growth and tax revenue,
i.e., economic expansion resulted in higher tax collections. We found that trade balance inflation and
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Unemployment had a limited impact on revenue, while tests indicate a strong connection between GDP
growth and GST's impact on tax collection.
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