Festive Demand Fuels Collection Growth
The finance ministry reported that gross GST revenues rose from ₹1.87 trillion in October 2024 to ₹1.96 trillion in October 2025. Despite a slowdown in the growth rate, the collection surpassed market expectations after rate reductions on 375 items took effect in late September.
According to Price Waterhouse & Co (PWC) partner Pratik Jain, the increase in collections despite large-scale rate cuts highlights strong consumer sentiment and improving tax compliance. “The rise shows steady demand, and the increase in GST refunds indicates administrative confidence in long-term revenue stability,” he said.
Breakdown of Domestic and Import Revenues
Government data shows domestic GST revenues rose 2% to ₹1.45 trillion, while collections from imports surged 13% to ₹50,884 crore in October. The net GST revenue, after adjusting for refunds worth ₹26,934 crore, stood at ₹1.69 trillion a 0.2% year-on-year rise.
Refund claims also jumped 39.6%, reflecting faster processing and greater export activity. Experts suggest that these trends point to improving compliance efficiency and a rebound in trade-related tax payments.
Experts Expect November to Record Higher Collections
Tax experts believe November’s numbers could reflect a sharper increase due to the full impact of festive season sales. “Lower tax rates on consumer durables and essentials have boosted affordability, which will reflect in next month’s collections,” said Karthik Mani, Partner at BDO India.
Industry sources, including the Confederation of All India Traders (CAIT), estimated that India’s total Diwali sales crossed ₹6 trillion, further strengthening prospects for robust November collections.
GST Rate Cuts and the New Two-Tier Structure
On 22 September 2025, the GST Council implemented a simplified two-tier tax system, reducing slabs to 5% and 18%. This reform replaced the previous multi-layered structure, aiming to streamline compliance and stimulate demand.
The tax cuts covered essential and non-essential goods, including automobiles, consumer electronics, kitchen staples, medicines, and home appliances. The move was designed to boost affordability and reduce inflationary pressure before the festive season.
India’s Tax Reforms Aimed at Sustained Growth
Experts see these results as a sign of India’s successful balancing of tax rationalization with fiscal growth. The moderate yet positive rise in GST collections reflects a healthy combination of administrative efficiency and rising demand.
