GST
GST collections up 4.6% to Rs 1.96 lakh crore in October
India’s Goods and Services Tax (GST) collections climbed to a five-month high of Rs 1.96 lakh crore in October, registering a 4.6 percent year-on-year increase — the slowest pace of growth in 52 months, according to data released by the finance ministry on Saturday.
Although the total collections in October rose from Rs 1.89 lakh crore in the previous month, the growth rate nearly halved compared to September’s 9.1 percent.
Despite the slowdown, October marked the tenth consecutive month in which revenues surpassed the Rs 1.8 lakh crore mark, underscoring a continued trend of strong inflows.
The last time collections had crossed Rs 2 lakh crore was in May.
The moderation in growth appears to be linked to recent adjustments in the GST framework.
Following Prime Minister Narendra Modi’s announcement in August, the government implemented a major rationalisation of GST slabs in late September, eliminating the 12 percent and 28 percent categories and moving nearly 90 percent of goods into lower tax brackets — a move aimed at simplifying compliance and reducing consumer costs.
Net GST collections for October stood at Rs 1.69 lakh crore, a marginal 0.6 percent increase from the previous year.
Domestic revenues remained largely unchanged, while net customs revenue grew 2.5 percent to Rs 37,210 crore.
On the refunds front, disbursements saw a notable jump — 26.5 percent higher for domestic taxes and 55.3 percent higher for customs compared to last year.
Gross domestic GST revenues edged up 2 percent to Rs 1.45 lakh crore from Rs 1.42 lakh crore in October 2024, suggesting that the recent tax rationalisation may have temporarily moderated revenue momentum even as consumption remained steady.
The Reserve Bank of India (RBI) and the International Monetary Fund (IMF) both see the recent GST reforms as a potential boost to the economy.
The RBI recently revised India’s GDP growth projection upward to 6.8 percent from 6.5 percent, while the IMF raised its forecast to 6.6 percent from 6.4 percent, citing strong domestic demand and policy support expected to cushion the economy from external pressures such as U.S. tariffs.
Overall, while the October numbers reflect a slight cooling in GST growth, the sustained high revenue base suggests continued economic resilience, supported by a broader formalisation of the economy and robust consumer spending across sectors, according to market experts.
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