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News Topical, Digital Desk : New GST rates came into effect from September 22. GST rate cut made most of the items from food items to everyday use cheaper. Despite this, the government's treasury is full. October's GST collection has seen a jump. According to government data released on Saturday, India's Gross Goods and Services Tax (GST) collection in October increased by 4.6% to around Rs 1.96 lakh crore compared to last year due to festive demand and stagnant consumption.
Prices of 375 items have become cheaper, yet they have increased.
According to a PTI report, this increase in GST collections came despite the reduction in GST rates on 375 items – from kitchen essentials to electronics and automobiles – which came into effect on September 22nd, coinciding with the start of Navratri, a crucial festive period for consumer spending.
October collections reflected the impact of strong festive season sales, as many consumers postponed purchases ahead of the widely expected rate cut. Prime Minister Narendra Modi announced in his Independence Day speech that GST rates would be reduced before Diwali, with these reductions taking effect from the start of Navratri.
Gross GST collections for October stood at ₹1.96 lakh crore, compared to ₹1.87 lakh crore in October 2024. In contrast, collections in August and September this year were ₹1.86 lakh crore and ₹1.89 lakh crore, respectively.
However, the 4.6% year-on-year growth in October was lower than the average 9% growth recorded in previous months. Domestic revenue, an indicator of local sales, rose 2% to Rs 1.45 lakh crore, while GST from imports rose 13% to Rs 50,884 crore.
GST refund also accelerated
GST refunds grew sharply by 39.6% year-on-year to ₹26,934 crore, while net GST revenues in October 2025 stood at ₹1.69 lakh crore, a marginal increase of 0.2% year-on-year.
Abhishek Jain, Head of Indirect Tax and Partner at KPMG, said, "Higher gross GST collections reflect a strong festive season, higher demand, and a rate structure that businesses have adopted well. This is a positive sign that both consumption and compliance are moving in the right direction."
Furthermore, the impressive, high percentage increase in collections from states/union territories such as Arunachal Pradesh, Nagaland, Lakshadweep, and Ladakh is a strong indicator of overall economic growth and deepening formalization across India. This broad-based growth indicates a stronger, more integrated national economy and confirms the systemic success of the GST framework.
Mahesh Jaisingh, Partner and Indirect Tax Leader, Deloitte India, said, “With the GST rate revision and the GST Utsav Dhamaka, which saw significant GST rate cuts, India's GST collections in October 2025 increased to ₹1.96 lakh crore, a growth of 4.6% over the previous year and reflects the strength of our economy amid the festive season and improved compliance.”
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