NEW DELHI: Growth in Goods and Services Tax (GST) collections moderated to 3.2% in May, with total mop-up standing at Rs 1,94,184 crore, primarily due to a decline in revenue from domestic transactions. According to the latest data for May, which reflects transactions made in April, GST from domestic sources fell by 2.6% to Rs 1,34,530 crore.
One-Time Telecom Payment Impact
The government attributed this slowdown to a one-off gain of Rs 10,000 crore in May 2025 from a payment made by a telecom operator for spectrum allocation. Adjusting for this exceptional item, officials stated that the overall GST kitty recorded a 9% increase in May. They asserted that consumption remains robust across various sectors, including agriculture, manufacturing, real estate, transport, consumer goods, and electronics, following the rationalization of the GST structure implemented in September last year.
Taxable Value Data Released
Unlike most months, officials also shared data on the taxable value of goods and services. The taxable value for goods in April was estimated to have surged 27% to over Rs 40 lakh crore, with gold and precious metals leading the charge with a 47% jump to over Rs 5.1 lakh crore. In the services sector, taxable value rose 22% to Rs 11.5 lakh crore.
Import GST Surge
Integrated GST (IGST) on imports also saw a robust increase of over 20% to more than Rs 60,000 crore in May. Coal accounted for the largest share, with collections soaring nearly five times to Rs 3,749 crore. Memory chips recorded a three-fold increase, while processing units saw a five-fold jump. Abhishek Jain, Indirect Tax Head & Partner at KPMG, commented, "While import GST has recorded a near 20% growth, this may also be attributed to rupee depreciation. Adjusted for the one-time telecom payment in the base, domestic collections reflect moderate growth."
Outlook
The government remains optimistic about sustained consumption trends, supported by the GST rate rationalization and strong performance in key sectors. However, the one-time adjustment highlights the need for careful analysis of underlying revenue trends.
