GST Collections Skyrocket 16.4% to Rs. 2.01 Lakh Crore in May

India’s GST Collections for May 2025 Reach Rs 2.01 Lakh Crore

India’s gross Goods and Services Tax (GST) collections for May 2025 amounted to Rs 2.01 lakh crore, reflecting a growth of 16.4% compared to Rs 1.72 lakh crore gathered in May 2024, as reported by the Ministry of Finance on Sunday. This surge follows an impressive GST revenue of Rs 2.37 lakh crore recorded in April, indicating robust tax collection over consecutive months.

Saurabh Agarwal, a Tax Partner at EY, commented, “While last month’s elevated collections likely included year-end business-to-business sales aimed at meeting targets, the substantial drop suggests a possible shift in consumer spending due to global uncertainties.”

Detailed Revenue Analysis

The year-over-year growth was fueled by a notable 25.2% increase in GST revenue from imports, coupled with a 13.7% rise from domestic transactions. In the reviewed month, gross GST revenue from imports reached Rs 51,266 crore, while domestic sources contributed Rs 1.50 lakh crore. Vivek Jalan, Partner at Tax Connect Advisory Services LLP, remarked that “this month’s uptick in GST revenue is predominantly driven by imports rather than domestic consumption. Additionally, year-to-date figures support this trend. Exports refunds are not seeing corresponding growth, underscoring that import growth significantly outweighs export growth.”

Breakdown of Central, State, and Integrated GST

For May, the breakdown of GST revenue showed that Central GST (CGST) accounted for Rs 35,434 crore, State GST (SGST) totaled Rs 43,902 crore, and Integrated GST (IGST) stood at approximately Rs 1.09 lakh crore. Furthermore, the government gathered Rs 12,879 crore through the GST compensation cess. In contrast, total refunds for May experienced a 4% decline, totaling Rs 27,210 crore.

In response to these figures, Saurabh Agarwal noted, “On a positive note, GST collections have consistently shown growth in various states and union territories, such as Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Tripura, Meghalaya, Assam, Lakshadweep, and Andaman & Nicobar, highlighting a trend of wider development throughout the nation.” Looking ahead, he anticipated that similar GST collection numbers might arise in June, albeit with slight increases, potentially impacted by ongoing global geopolitical tensions.

Future Implications for Tax Rate Rationalization

Pratik Jain, Partner at Price Waterhouse & Co LLP, stated, “If this growth trajectory sustains over the next couple of months, it could provide the government with some flexibility to consider rate rationalization, an area that has already been the subject of extensive work.”