GST spurts fiscal equality: tax-GSDP ratio higher in poorer states Goods and Services Tax (GST) collections topped Rs 1.5 trillion for the third month in a row in May 2023. It was the 15th consecutive month of more than Rs 1.4 trillion GST revenue.

One aspiration for the GST system was that it would lead to regional development as it is a destination-based tax regime. In the mid 1990s, an acronym BIMARU, coined by Ashish Bose, described low development in Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh.

Madhya Pradesh and Rajasthan may no longer be in this category now and smaller new states were carved out of Bihar, Uttar Pradesh and Madhya Pradesh later.

As such, let us take four states—Uttar Pradesh, Bihar, Meghalaya and Manipur—where per capital income was less than Rs one lakh a year in 2020-21 to assess how GST revenues have risen there and compare it with large producing

and consuming states, such as Maharashtra, Gujarat and Karnataka. Most poor states are consuming ones except for Uttar Pradesh.