GST Juggernaut Rolls On: India’s GST Revenue Hits Consecutive ₹2 Lakh Crore Milestones

India's Goods and Services Tax (GST) revenues have for the second month in a row crossed the ₹2 lakh crore threshold in May 2025, indicating strong economic activity and better tax compliance across the country. The gross GST revenue collected in May 2025 was ₹2.01 lakh crore, a 16.4% year-on-year increase from May 2024, although a shade short of the record ₹2.37 lakh crore gathered in April 2025.

 

Key Highlights:
 

Sustained Growth: May's GST collections increased 16.4% year on year, driven by strong domestic demand and a rebound in imports.

 

Breakdown of Revenue:

Domestic vs Imports: Domestic trade contributed ₹1.50 lakh crore (13.7% growth), whereas Import GST grew 25.2% to ₹51,266 crore.

 

Net Collections: Following the refund of ₹27,210 crore (4% lower YoY), the net GST collection for May was at ₹1.74 lakh crore, 20.4% higher than the comparable period a year ago.

 

State-wise Performance: Maharashtra led the pack with ₹31,530 crore (17% growth), followed by Karnataka, Tamil Nadu, Gujarat, and Delhi. West Bengal and Tamil Nadu states witnessed growth up to 25%, while Gujarat, Andhra Pradesh, and Telangana witnessed growth up to 6%.

 

Policy Changes: From July 2025 onwards, taxpayers are not allowed to make changes to GSTR-3B forms or file GST returns after three years from the initial due date, according to new GSTN releases.

 

Expert View: Tax professionals have attributed the growth to robust domestic consumption, technology drivers such as e-invoicing, and enhanced compliance. They further observe that the asymmetric growth across states might be due to sectoral or seasonal considerations.

 

Prognosis

The steady GST performance over ₹2 lakh crore is an indicator of India's recovering economy as well as efficient tax governance. Experts opine that sustained momentum can open doors to rate rationalization in the future and sustained fiscal health.

 

“The consistency this month along with a 16 plus percent year-on-year growth points to strong underlying momentum and a recovery that’s clearly taking hold.” — Abhishek Jain, KPMG 

 

Source: The Hindu Business Line, Times of India, CNBC-TV18, Economic Times, Business Today, The Week, ClearTax.