Festive Demand Lifts October GST Collections to ₹1.96 Lakh Crore Despite Rate Cuts

India’s gross Goods and Services Tax (GST) collections rose 4.6% year-on-year to about ₹1.96 lakh crore in October 2025, boosted by strong festive demand even as tax rates were slashed on hundreds of products.

GST Rate Cuts Ahead of the Festive Season

With effect from September 22, the first day of Navratri, considered auspicious for major purchases, the government reduced GST rates on 375 items ranging from household staples to consumer electronics and automobiles. The rate cuts followed Prime Minister Narendra Modi’s Independence Day announcement that GST relief would be introduced before Diwali to stimulate consumption.

The October collection reflects the release of pent-up consumer demand as shoppers rushed to take advantage of lower rates during the festive season. Many consumers had deferred big-ticket purchases in anticipation of the rate cuts, resulting in a strong rebound once the reductions took effect.

Year-on-Year Growth Slower Than Average

According to government data released on Saturday, the gross GST mop-up in October stood at ₹1.96 lakh crore, compared to ₹1.87 lakh crore in the same month last year. Collections in August and September were slightly lower at ₹1.86 lakh crore and ₹1.89 lakh crore, respectively.

While October’s 4.6% year-on-year rise indicates a positive trend, it remains below the average 9% growth recorded in earlier months of the fiscal year. Domestic GST revenue increased 2% to ₹1.45 lakh crore, while tax collected from imports jumped 13% to ₹50,884 crore in October.

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GST refunds climbed sharply by 39.6% year-on-year to ₹26,934 crore. Consequently, net GST revenue for October 2025 stood at ₹1.69 lakh crore, reflecting a marginal 0.2% increase compared to the previous year.

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