GST Collections Hit ₹1.96 Lakh Crore in July 2025, But Net Growth Slows Sharply to 1.7%.
Economy Business
In July 2025, India’s goods and services tax (GST) system garnered a record gross collection of approximately ₹1.96 lakh crore, marking a steady 7.5% year-on-year rise, despite ongoing global uncertainties—highlighting stable domestic consumption and import activity. However, a sharp surge in refunds eroded growth, pushing net GST revenue to just ₹1.69 lakh crore, or a modest 1.7% increase from July 2024.
- India’s gross GST revenue constituted ₹1.95–1.96 lakh crore in July 2025, up from ₹1.82 lakh crore a year prior. While the headline collection indicator rose by 7.5%, the net realisation—after accounting for ₹27,147 crore in refunds—registered only a 1.7% increase to ₹1.69 lakh crore, underscoring that a large share of the collection was returned to taxpayers.
- Domestic GST revenues rose at a moderate 6.7%, totaling around ₹1.43 lakh crore, whereas GST on imports jumped 9.5% YoY, touching ₹52,712 crore, buoyed by higher import volumes and increased consumption of imported goods. Notably, net revenue from domestic sources saw a slight contraction, pointing to softening internal demand or compliance issues amid rising refund claims.
Main Point :- (i) Within total collections, IGST accounted for the largest slice—about ₹1.03 lakh crore, followed by SGST at ₹44,059 crore, CGST at ₹35,470 crore, and compensation cess of ~₹12,670 crore. Refund outflows soared by 66.8%, consistent with earlier trends and likely due to excess input tax credits, inverted duty structures, or procedural timing effects. This mismatch heavily weighed on net receipts.
(ii) For the April–July 2025 window, gross GST mop-up reached ₹8.18 lakh crore, up 10.7% YoY, while net collections touched ₹7.11 lakh crore, rising 8.4%. While the cumulative figures suggest continued fiscal strength, the dip in net growth rate is emerging as a fiscal warning, especially if refund trends persist through H2.
(iii) State-wise trends reveal disparate performance—Madhya Pradesh (+18%), Andhra Pradesh (+14%), and Bihar (+16%) recorded double-digit gains, while Maharashtra (+6%), Karnataka and Tamil Nadu (+7‑8%) saw slower momentum. Telangana, Delhi, and Gujarat posted modest growth in the low single digits. On the downside, states like Manipur (‑36%), Mizoram (‑21%), and Jharkhand (‑3%) suffered steep declines—reinforcing the need for deeper analysis of intra-state compliance and economic divergence.
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