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Qatar Tribune
a day ago
- Business
- Qatar Tribune
India's GST collections cross $24 bn in May 2025
Agencies Mumbai In May 2025, India's Goods and Services Tax (GST) collections exceeded $24.1 billion for the second month in a row, showing a strong year-on-year growth of 16.4 percent. India's Goods and Services Tax (GST) collections remained above $24.1 billion for the second consecutive month in May 2025, registering a robust 16.4 per cent year-on-year growth. The latest data, released by the Ministry of Finance, comes just days before the Reserve Bank of India (RBI) convenes for its bi-monthly Monetary Policy Committee (MPC) meeting on 4 June. The total GST revenue stood at $24.1 billion in May, compared to $20.6 billion in May 2024. This follows a record $28.4 billion collection in April 2025. Net revenue after refunds amounted to $20.8 billion, a sharp 20.4 percent rise from $17.2 billion collected in May last year. The growth was driven largely by import-related taxes. GST revenue from imports rose 25.2 percent to $6.2 billion, while domestic transactions contributed $18 billion, up 13.7 percent from the previous year. Total refunds issued declined 4 percent to $3.26 billion. 'The 16 per cent growth in GST collections in the month shows a renewed upward momentum after a few months of growth in the range of 11–12 per cent,' Pratik Jain, Partner at Price Waterhouse, told PTI. 'If this growth sustains over the next few months, it might provide a cushion for the government to consider rate rationalisation, on which significant groundwork has already been done,' he added. However, experts warn that the growth pattern is not uniform across India. States like Maharashtra, West Bengal, Karnataka, and Tamil Nadu posted strong collection growth of 17–25 percent. -'The average growth across the country does not appear to be uniformly reflected across states, possibly due to sectoral or seasonal factors which require deeper, data-based analysis,' Mani said. Several tax analysts believe the growth is being powered by imports rather than domestic consumption. Vivek Jalan, Partner at Tax Connect Advisory Services LLP, told PTI that while import-related GST rose nearly 73 percent, domestic revenue growth was modest in comparison. 'This, coupled with the fact that export refunds are not growing correspondingly, reflects the fact that import growth far exceeds export growth,' Jalan explained. EY India's Saurabh Agarwal also told PTI that similar numbers could be seen in June owing to ongoing geopolitical developments impacting global trade flows. The strong GST collections—an indicator of sustained economic activity—arrive just as the Reserve Bank of India prepares for its rate-setting Monetary Policy Committee (MPC) meeting, scheduled from 4–6 June. Economists widely expect the six-member panel to deliver a 25-basis point rate cut, reducing the repo rate from 6 percent to 5.75 percent, in what could be the third consecutive rate cut in 2025. The move is backed by a steep fall in inflation. India's consumer price index (CPI) dropped to 3.2 per cent in April, the lowest in nearly five years. This aligns well within the RBI's flexible inflation targeting framework of 4 percent. According to the RBI's annual report, 'The benign inflation outlook and moderate growth warrant monetary policy to be growth supportive, while remaining watchful about rapidly evolving global macroeconomic conditions.' Market participants and lenders are also anticipating a total of 50 basis points in rate cuts for FY26, which would help lower external benchmark lending rates (EBLR) and reduce borrowing costs for home, auto and personal loans. As GST revenues remain strong and inflation eases, the central bank may find ample headroom to support India's growth trajectory through accommodative monetary policy.
Time of India
5 days ago
- Business
- Time of India
GST collections up 16%, fastest since Oct 2022
Goods and Services Tax (GST) NEW DELHI: Goods and services tax (GST) collections rose 16.4% to Rs 2,01,050 crore in May, the fastest pace of expansion since Oct 2022, on the back of a jump in taxes on imports. Latest data estimated that during May (for transactions in April), GST collections from imports rose 25.2% to Rs 51,266 crore, while the mop-up from domestic sources, which is almost three-fourths of the overall kitty, was 13.7% higher at just under Rs 1.5 lakh crore. Imports during April had shot up 19% to nearly $65 billion due to a spike in crude oil and fertiliser shipments, among other things. "A 16% growth in GST collections shows a renewed upward momentum after few months of growth in the range of 11% to 12%. If the growth continues in this range for next couple of months, it might provide the cushion for govt to look at rate rationalisation on which a lot of work has already been done," said Pratik Jain, partner at consulting firm PwC. Last week, govt sources indicated that the finance ministry is working with the states to rationalise GST rates with a review of the slabs on the table. On a net basis, collections were 20.4% higher at Rs 1,73,841 crore as refunds were 4% lower at Rs 27,210 crore, despite domestic refunds soaring 53.7% to Rs 18,314 crore. There was, however, wide variation among the states. Arunachal Pradesh (53%), Nagaland (46%) and Delhi (38%) topped the growth charts, with Tamil Nadu (25%), Kerala (24%), Bihar (23%) and Karnataka (20%) in the middle. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch CFD với công nghệ và tốc độ tốt hơn IC Markets Đăng ký Undo At the other end, were Andhra (2% dip), Uttarakhand (13% decline) and Mizoram (26% fall) which reported lower collections. "The average growth across the country does not appear to be uniformly reflected across states, possibly due to sectoral or seasonal factors, which require a deeper data based analysis, said M S Mani, partner for indirect taxes at Deloitte India. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
