August GST Collection Rises 6.5% to Rs1.86 Lakh Crore Ahead of GST Council Meeting

Moneylife Digital Team 01 September 2025

Economy & Nation

India’s goods and services tax (GST) collections rose 6.5% in August to Rs1.86 lakh crore, supported by stronger domestic consumption even as imports slowed. The figure compares with Rs1.75 lakh crore collected in August last year but was lower than July’s Rs1.96 lakh crore.

According to official data released on Monday, gross domestic GST revenue grew 9.6% year-on-year (y-o-y) to Rs1.37 lakh crore, while GST from imports fell 1.2% to Rs49,354 crore. Refunds declined 20% to Rs19,359 crore. After accounting for refunds, net GST revenue stood at Rs1.67 lakh crore, reflecting a 10.7% increase compared with the same month last year.

So far in the financial year (FY)25–26, GST collections from April to August have touched around Rs10 lakh crore, up 9.9% from Rs9.13 lakh crore during the corresponding period of FY24–25. All components, central GST (CGST), state GST (SGST), integrated GST (IGST) and cess, recorded y-o-y growth.

August’s figures continue the trend of robust GST performance in recent years. Collections have steadily risen from Rs11.37 lakh crore in FY20–21 to Rs20.18 lakh crore in FY23–24, with the system recording a record Rs22.08 lakh crore in FY24–25. The average monthly collection of Rs1.84 lakh crore in FY24–25 was the highest since GST’s introduction in July 2017.

Commenting on the August GST data, Aditi Nayar, chief economist at ICRA, says, “While CGST and SGST recorded a double-digit expansion, the growth in IGST and cess collections was tepid, dampening the headline GST increase to 6.5%. Low inflation readings for the wholesale price index (WPI) and the consumer price index (CPI) may partly be dampening GST growth. The contraction in IGST on imports is puzzling in light of the sharp increase in merchandise imports in July 2025.”

The release of the figures comes just ahead of the GST council meeting on 3rd to 4 September 2025 in New Delhi, where Union minister of finance Nirmala Sitharaman and state finance ministers will discuss rate rationalisation, including a possible move to a two-slab structure of 5% and 18%. The Council will also review reports by groups of ministers (GoMs) on cess, insurance taxation and anti-profiteering mechanisms.

Earlier on 15 August 2025, prime minister (PM) Narendra Modi had announced that next-generation GST reforms would be unveiled by Diwali, promising 'substantial' tax relief for citizens and benefits for small and medium enterprises.

The steady growth in collections signals resilience in India’s consumption-driven economy, and with the festive season approaching, policymakers expect revenues to strengthen further in the coming months.

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