Delhi, New Delhi: After accounting for refunds, the central and state governments collected ₹1.77 trillion in Goods and Services Tax (GST) in March, which was 7.3% more than they received during the same period last year, according to official data.
After accounting for refunds, GST receipts increased by 8.6% in FY25 to ₹19.56 trillion, according to figures from GSTN, the state-owned business that handles tax returns.
According to data, a GST refund of ₹19,615 crore was granted in March, and ₹2.52 trillion was granted in the most recent fiscal year.
While revenue from imports—integrated GST (IGST) proceeds—remained essentially unchanged at ₹38,830 crore in March, net tax collection from domestic sales increased 9.3% annually to ₹1.38 trillion. According to the ministry of commerce, merchandise imports fell 16% yearly to $50.96 million in February.
Tax on transactions conducted in February is collected in March.
While IGST revenue and the associated cess on imports increased by just 3.5% annually, net GST revenue from domestic sales increased by 10.1%. According to M.S. Mani, partner-indirect taxes at Deloitte India, this may be a result of the effectiveness of many import substitution initiatives, with a particular emphasis on Atma Nirbhar Bharat, as well as some production-linked incentive programs.
Revenue collection, before tax refund adjustments, was ₹1.96 trillion in March, representing a 9.9% annual rise, and ₹22 trillion in the just concluded fiscal year, representing a 9.4% annual growth.
Resilient economy
According to Saurabh Agarwal, a tax partner at EY, the steady increase in GST revenues points to a robust domestic economy that appears to be immune to global economic difficulties and is fueled by robust consumer spending.
In order to streamline the GST structure, eliminate tax anomalies such as raw materials paying greater taxes than completed goods, and provide tax relief on certain goods and services, the GST Council, a federal indirect tax agency, is now investigating additional tax rate rationalization. Proposals in this area are being reviewed by a ministerial team led by Bihar deputy chief minister Samrat Chaudhary. The next meeting of the GST Council may include the panel’s suggestions.
Of the major state economies, Maharashtra recorded a 14% improvement in GST income receipts in March, while Uttar Pradesh reported a 10% yearly increase. Tamil Nadu saw a 7% growth, while Gujarat reported a 6% growth. In March, Delhi recorded a 5% increase in GST revenue.
The tax collection growth in FY25 has been facilitated by proceedings pertaining to short-payment of taxes concluded for the previous three fiscal years, according to experts. They said that increased tax collection has also been aided by better data collecting and reporting regulations.
