The first full month reflecting the impact of GST rate cut yielded a moderate increase of 0.7 per cent in November of Rs 1.7 lakh crore, according to government data released on Monday. Government officials, however, maintained that the underlying consumption momentum remains positive.
Gross domestic GST revenues fell 2.3 per cent to ₹1.24 lakh crore, while revenues from imports grew over 10 per cent to around ₹46,000 crore. November collections correspond to economic activity in October, the first complete month after GST rates were reduced on 375 items with effect from September 22.
According to Vivek Jalan, Partner at Tax Connect, GST collections mirror consumption trends, whereas GDP growth is driven by government expenditure, investment, trade surplus and consumption. “The increase in GDP had a major component of government expenditure which, when discounted, gives a muted GST collection. Furthermore, there is the impact of the GST 2.0 rate reduction,” Jalan said.
Manoj Mishra, Partner at Grant Thornton Bharat, noted that a moderation of this kind was expected as the festive cycle tapered and the impact of rate cuts filtered through. “What is notable is that collection levels remain stable on a historically high base, which indicates that India’s underlying demand engine continues to hold firm,” he said.
Government officials pointed out that despite the headline moderation, the taxable value of supplies under GST grew 15 per cent during September–October 2025, compared with 8.6 per cent in the same period last year. “This surge demonstrates strong consumption uplift, stimulated by reduced rates and improved compliance behaviour. It vindicates our strategy that lowering rates on essentials and mass-use sectors would create demand-side buoyancy — a Laffer Curve–type uplift,” an official said.
Officials added that GST Next-Gen Reforms have not disrupted revenue stability and that consumption-led buoyancy is beginning to reflect in higher taxable value across sectors. “Growth has been particularly strong in sectors where rate rationalisation occurred — FMCG, pharma, food products, automobiles, medical devices, textiles and others,” the official said.
While officials refrained from commenting on the FY26 target, tax experts remain optimistic. “With GST 2.0 driving structural clarity and digital compliance, collections could average ₹1.80-1.85 lakh crore in the coming months, keeping us on track for a record annual mop-up of over ₹21 lakh crore. These reforms are enabling ease of doing business and fuelling consumption-driven growth,” said Mahesh Jaising, Partner & Indirect Tax Leader, Deloitte India.