India’s GST collections cross ₹2 lakh crore mark for second consecutive month, surge 16.4pc in May

THEBUSINESSBYTES BUREAU

NEW DELHI, JUNE 1, 2025

In a clear signal of sustained economic momentum and robust consumption trends, India’s gross Goods and Services Tax (GST) collections soared to ₹2.01 lakh crore in May 2025, marking a sharp 16.4% year-on-year increase from ₹1.72 lakh crore in May 2024, according to data released by the Ministry of Finance on Sunday.

This is the second consecutive month that GST revenues have remained above the ₹2 lakh crore threshold, reinforcing optimism around India’s macroeconomic resilience and compliance efficiency. The performance follows an all-time high of ₹2.37 lakh crore collected in April — a month typically bolstered by year-end filings and reconciliations.

Notably, May’s figures demonstrate that the strong revenue momentum is not merely seasonal but rooted in underlying economic strength. Net GST revenue — factoring in refunds — jumped by more than 20% to ₹1.73 lakh crore, underscoring improved tax administration and collection efficiency.

Breakdown of the figures shows a 13% increase in domestic GST collections and a robust 25.7% surge in GST collected on imports, indicating both domestic vibrancy and stronger global trade inflows.

The uptick in GST revenues aligns with other key economic indicators. India’s GDP growth for FY24-25 met its target of 6.5%, with the economy expanding by an impressive 7.4% in the January–March quarter. This growth trajectory has been largely driven by private consumption, which continues to recover steadily.

Data from April showed consumer durable goods — including appliances and electronics — grew by 6.4%, maintaining strong momentum after a 6.9% rise in March.

Experts attribute the continued strength in GST collections to a combination of rising consumption, improved compliance measures, and the formalization of more sectors of the economy. A senior government official noted that April’s record collection reflected heightened year-end economic activity, but May’s performance confirms that India’s tax base is deepening and stabilizing.