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India’s GST Growth Slows Beneath Strong Headline Collections
India collected more GST in September than it did a year earlier.
The total was above ₹2 lakh crore, and collections after refunds also increased.
But economists say these headline numbers do not tell the whole story.
Changes in how some taxes are counted make comparisons between years harder.
Their calculations show that underlying GST growth slowed in FY26 and was especially low in the first quarter of FY27.
Growth improved in the second quarter, but remained below the headline figure.
They also say net GST revenue made up a smaller share of the economy in FY26 than in FY24 and FY25.
This matters because governments rely on tax revenue to fund their finances.
Economists’ calculations show actual gross GST growth slowed to 5.8% in FY26, below headline growth of 7.5%.
In Q1 FY27, headline GST growth was 10.5%, while actual gross growth was 1.5%.
In Q2 FY27, headline growth reached 15%, compared with 9.5% actual gross and 8.2% actual net growth.
September gross collections rose 14.7% year-on-year to more than ₹2.03 lakh crore, and net collections rose 18.1%.
The authors say changes to the treatment of compensation cess and additional excise duty complicate comparisons across periods.
- Who
- Economists Subramanian, Felman and Anand analyzed GST revenue trends; the government reported monthly collection figures.
- What
- The analysis finds underlying GST revenue growth has slowed despite strong headline and monthly collection figures.
- Where
- India
- When
- The figures cover FY23 through Q2 FY27, including September collections and changes made after September 2025.
- Why
- Changes in the treatment of some levies make headline GST figures less comparable and may obscure the underlying revenue trend.
Key facts
- September gross GST collections
- More than ₹2.03 lakh crore, up 14.7% year-on-year
- September net GST collections
- More than ₹1.76 lakh crore after refunds, up 18.1%
- September domestic GST collections
- Around ₹1.38 lakh crore, up 10.1%
- September import revenue
- ₹65,525 crore, up 26%
- FY26 headline GST growth
- 7.5%
- FY26 actual gross GST growth
- 5.8%
- Net GST share of GDP
- 5.7% in FY26, compared with around 6% in FY24 and FY25
- April–September FY27 collections
- Gross collections rose 11.6% to more than ₹12.46 lakh crore; net collections rose 10.4% to over ₹10.66 lakh crore
Sources
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