The BRICS TimesGST collections reached ₹1.96 lakh crore in October. This showed a 4.6% increase year-on-year. The growth was steady despite consumers delaying spending due to anticipated rate cuts.
October Revenue is Fifth Highest Since GST Launch
Gross Goods and Services Tax (GST) revenue almost touched ₹1.96 lakh crore in October. This collection is the fifth highest monthly total since the tax began in 2017. The figure mainly covers September’s business activity. Consumers postponed purchases that month. They were waiting for the massive rate cuts that took effect on September 22. Any month’s GST data reflects the preceding month’s business.
Modest Growth Validates GST 2.0 Strategy
The modest growth confirms the government’s GST 2.0 strategy. November collections will show October’s business activity. These figures are expected to show the first full month of festive buying post-rate cut. Ministers claim that this festive buying has significantly surged. Domestic revenue growth remained muted at 2%. It rose to ₹1.45 lakh crore from ₹1.42 lakh crore in October 2024.
Import Tax Bolsters Total Collection
Gross tax revenue from imports soared by 12.84%. It reached ₹50,884 crore. This jump pushed total gross GST collections to ₹1,95,936 crore. This represents a 4.6% increase from the same month last year. The government released this data on Saturday. The GST Council approved rate cuts on 375 items on September 3. These cuts ranged from household goods to automobiles. The revenue impact was about ₹48,000 crore. This figure is based on the 2023-24 consumption patterns.
Refunds Surge, Net Collection Shows Slight Rise
Net GST collection saw only 0.6% growth after refunds. It was ₹1,69,002 crore, up from ₹1,68,054 crore in October 2024. Refunds, however, dramatically jumped by about 40%. This move released working capital for businesses. Exporters especially benefited from this refund surge. Saurabh Agarwal, a tax partner at EY India, praised this. He called the government’s commitment to solving working capital issues a significant positive development. “Certainty in the tax regime boosts investor confidence,” he stated. It also reinforces the ease of doing business.
Experts Anticipate Robust Future Collections
Tax experts had anticipated the subdued October figures. They predict robust collections in the near future. Agarwal noted that the subdued figure reflects September’s momentum. This was due to rate rationalization and deferred spending. “This anticipated lag is likely to be compensated,” he added. He expects more robust numbers next month due to seasonal buoyancy. MS Mani, a partner at Deloitte India, said the “marginal growth of 4.6%… is on account of postponement of supplies” before the rate cuts. Ending the compensation cess, especially on cars, also hurt collections. Mani concluded that marginal growth despite reduced rates proves consumption remains robust.
Finance Minister Cites Consumption Surge
The GST Council eliminated two of the four tax slabs. Only 5% and 18% rates remain, plus a special 40% levy. Finance minister Nirmala Sitharaman spoke last month. She said consumption surged 10% since the rate cuts. This added ₹20 lakh crore in consumer spending. She added that this triggers a “virtuous cycle” of growth.
