GST revenue grows 23% amid festive season demand

India’s gross Goods and Services Tax (GST) collections surged 23 per cent year-on-year to over Rs 2.31 lakh crore in October, marking the second-highest monthly mop-up on record, as festive-season demand boosted consumer spending and economic activity, according to government data released on Sunday.
October marked the second consecutive month in which gross GST collections crossed the Rs 2 lakh crore mark. The collection was second only to the record Rs 2.43 lakh crore registered in April. The 22.9 per cent year-on-year growth was also the fastest monthly growth recorded in the current financial year.Gross GST revenue from domestic sales increased 16 per cent to over Rs 1.59 lakh crore, while collections from imports rose 42 per cent to Rs 72,246 crore.
The total collection comprised Rs 42,935 crore in Central GST (CGST), Rs 51,340 crore in State GST (SGST) and over Rs 1.37 lakh crore in Integrated GST (IGST), the data showed.
GST refunds increased 6.5 per cent year-on-year to Rs 27,934 crore during the month. After adjusting for refunds, net GST collections rose 26 per cent to over Rs 2.03 lakh crore.During April-October, gross GST collections grew 13.2 per cent year-on-year to over Rs 14.77 lakh crore, while net collections increased 13 per cent to over Rs 12.69 lakh crore.
Manoj Mishra, Partner and Tax Controversy Management Leader at Grant Thornton Bharat, said October's collections reflect the festive-season demand cycle, which typically drives higher consumer spending, retail activity and the movement of goods across sectors.He added that the performance of key states, including Maharashtra, Karnataka, Gujarat, Uttar Pradesh and Madhya Pradesh, points to continued strength in GST collections across major economic centres.
Mishra said the focus should now be on sustaining domestic revenue growth and ensuring that the benefits of GST 2.0 translate into stronger compliance, smoother input tax credit flows and faster refunds for businesses.
Saurabh Agarwal, Tax Partner at EY India, said the October 2026 collections reflect the resilience of the Indian economy despite persistent global headwinds. He attributed the steady rise in revenue to strong underlying consumption and improving compliance.He added that the festive season is expected to keep demand buoyant and support strong collections in the coming months. Agarwal also emphasised the need for businesses to maintain robust compliance and reconciliation processes to sustain the benefits of this growth.
Mahesh Jaising, Partner, Indirect Tax at Deloitte, said sustained revenue growth despite significant rate cuts introduced in the middle of last year is providing the GST Council with confidence and room to continue its reform agenda.He said the 57th GST Council meeting reflected this momentum, with the focus increasingly shifting towards simplification, faster refunds, smoother credit flows and reducing compliance-related difficulties for taxpayers.
Nitin Vijaivergia, Partner at Price Waterhouse & Co LLP, said the October figures reflect strong revenue momentum, with domestic collections growing 15.8 per cent and import revenues surging 42.2 per cent, highlighting healthy consumption and the growing contribution of imports to overall GST revenue.Ikesh Nagpal, Lead, Indirect Taxation at AKM Global, said the collections coincided with festive-season spending and post-GST 2.0 price rationalisation, which may have supported demand across several sectors.He added that GST is increasingly serving not only as a revenue instrument but also as an indicator of economic formalisation and business activity.

(Business Correspondent)