GST collection rises to six month high of Rs 1.87 lakh crore, up 8.9% in October

GST collections rise in October

Goods and Services Tax collections rose to a six-month high of Rs 1.87 lakh crore in October, staying above the Rs 1.7 lakh crore mark for the eighth consecutive month, data released on November 1 showed.

Tax collections were 8.1 percent higher sequentially and 8.9 percent higher than in October 2023, when it stood at Rs 1.72 lakh crore, as festive season brought some cheer.

Tax collections were lower than the Rs 2.1 lakh crore mark hit in April.

A rise in GST revenues indicates a better economic performance than the previous two months when collections declined.

The growth in GST revenues was the lowest since the Covid period at 6.5 percent in September.

The pace of average GST collections has declined to Rs 1.77 lakh crore monthly in the second quarter compared with Rs 1.86 lakh crore in the first quarter of FY25.

Gross domestic revenues grew faster at 10.6 percent, while the growth in gross import revenue was lower at 3.9 percent.

Domestic refunds were 42.8 percent higher at Rs 10,498 crore compared with Rs 7,352 crore. Total refunds were 18.2 percent higher at Rs 19,306 crore.

Net GST revenues were 7.9 percent higher, with domestic revenues rising 8.7 percent.

"Recent GST collections indicate a potential slowdown in consumer spending in India, which surged in the previous fiscal year. The single-digit growth signals a cooling-off period," Saurabh Agarwal, Tax Partner, EY.

"The collections made in this month on account of festive season, particularly the performance of the automobile sector, will be crucial in determining the short-term trend. While the festive season is expected to boost collections, the overall outlook for the near future remains cautious," Agarwal further noted.