Net GST collections in December grow by 3.3%, reaching Rs 1.54 trillion

The net goods and services tax (GST) collection grew marginally by 3.3 per cent year-on-year (Y-o-Y) to Rs 1.54 trillion in December, amid an increase in refunds, according to provisional data released by the government on Tuesday. Sequentially, the mopup was lower than November’s level of Rs 1.63 trillion, which saw 11.1 per cent Y-o-Y growth. 

The gross GST collection — the amount before adjusting for refunds — rose by 7.3 per cent in December to Rs 1.76 trillion. 

Domestic refunds rose by 31 per cent, while total refunds, including those on imports (64.5 per cent Y-o-Y), climbed by 45.3 per cent to Rs 0.22 trillion. From April to December in FY25, total refunds grew by 13.5 per cent Y-o-Y to Rs 1.88 trillion. 

Cumulatively, from April through December, growth in total GST collection remained in single digit at 9.1 per cent Y-o-Y, down from the 10.1 per cent Y-o-Y growth recorded until the April-August period. Notably, the December figures reflect goods and services transactions from November. 

According to Pratik Jain, partner at PwC India, while year-to-date (YTD) domestic sales growth stood at over 10 per cent through December 2024, import growth lagged at just 2 per cent. 

Additionally, export-related refunds have seen a significant uptick. 

Given the slowdown in GST collections, the upcoming Budget could reveal whether the government adopts measures to boost consumption. "One of the ways to boost consumption is to rationalise the GST rates, which the GST Council is currently working on,” Jain said. 

Despite the overall muted growth, some states and UTs, such as Jammu & Kashmir (11 per cent), Punjab (22 per cent), Himachal Pradesh (10 per cent), Sikkim (30 per cent), Haryana (28 per cent), and the Andaman & Nicobar Islands (72 per cent), registered double-digit growth. 

However, states and UTs like Chandigarh, Arunachal Pradesh, Manipur, Meghalaya, and Lakshadweep reported a contraction.

Saurabh Agarwal, tax partner at EY India, observed: “The government is providing more GST refunds for exports, signifying an increase in the volume of goods and services we are selling to other countries. Simultaneously, we are observing lower growth in GST collected on imports, partly influenced by the rise in the value of the dollar compared to last year. This suggests that India is reducing its reliance on products manufactured abroad.” 

"These trends support the government's initiative to make India self-reliant (Atmanirbhar Bharat). This focus on domestic production and reduced reliance on imports is essential for the long-term sustainable growth of the Indian economy,” Agarwal added.