India’s Goods and Services Tax (GST) collections rose by 6.5% year-on-year to ₹1.86 lakh crore in August 2025, according to government data released on Monday. This marks the eighth consecutive month that revenues have remained above the ₹1.8 lakh crore mark, reflecting robust domestic consumption and steady economic activity.
During August, gross domestic GST revenue grew 9.6% to ₹1.37 lakh crore, while tax from imports slipped 1.2% to ₹49,354 crore. Refunds fell sharply by 20% year-on-year to ₹19,359 crore. Net GST revenue, however, showed strong momentum, rising 10.7% to ₹1.67 lakh crore.
Collections of Central GST, State GST, Integrated GST, and cess all recorded year-on-year increases. For the April-August period of FY26, gross GST collections rose 9.9% to about ₹10 lakh crore, compared to ₹9.13 lakh crore in the same period last year.
The buoyancy in tax collections continues a broader positive trend: GST revenues have steadily grown from ₹11.37 lakh crore in FY21 to ₹20.18 lakh crore in FY24, before hitting a record ₹22.08 lakh crore in FY25. The average monthly collection in FY25 stood at ₹1.84 lakh crore, the highest since GST was launched in July 2017.
The release of the August data comes just ahead of the GST Council meeting on September 3–4 in New Delhi, where the Centre and states are expected to deliberate on a major rationalisation exercise. The proposal under consideration includes moving most goods into a two-slab rate structure of 5% and 18%, while imposing a higher 40% rate on sin goods such as tobacco, cigarettes, and sugary drinks.
The buoyant revenue performance has also bolstered India’s fiscal position. Global investment bank Morgan Stanley, citing the strong April–June GDP growth of 7.8% and steady tax collections, revised its FY26 growth forecast upward to 6.7% from 6.2% earlier. It noted that the anticipated GST cuts, along with festive season demand and rural recovery, could offset external headwinds such as weaker exports following US tariff hikes.
Meanwhile, Prime Minister Narendra Modi, in his Independence Day address, hinted at “next-gen GST reforms” to be rolled out by Diwali, with the upcoming Council meeting likely to lay the groundwork for these changes.
(With agency inputs)
