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GST Data October 2025: Collection rises 9% YoY to 1.89 Lk Cr

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  Published in Business and Finance on Wednesday, October 1st 2025 at 5:51 GMT by Zee Business
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GST Collection for October 2025 Rises 9 % YoY to ₹1.89 Trillion – A Detailed Overview

The Central Board of Indirect Taxes and Customs (CBIC) released its latest Goods and Services Tax (GST) data for October 2025 on 15 November. The figures, which were posted on the CBIC’s official website and subsequently highlighted by the Economic Times and ZEEBIZ, show that the total net GST collections for the month rose by 9 % year‑on‑year (YoY) to ₹1.89 trillion (₹189 lakh crore). The month‑on‑month (MoM) growth was 4.2 %, signalling a steady up‑trend in consumer spending and industrial output. The headline figure, while impressive, is just the tip of the iceberg – the underlying story is about how different segments of the economy are behaving under the current tax regime.

1. Sectoral Distribution of Collections

The CBIC’s detailed report disaggregated the collections into five major categories: exempt, tax, surcharge, Cess, and other. The tax component – the core GST revenue – grew by 8.7 % YoY to ₹1.58 trillion. Exempt and other collections also saw modest gains, primarily due to a gradual reduction in the number of exempted goods as the GST Council finalized the “unification” of certain categories.

Industry‑wise: - Manufacturing: The industrial sector’s GST receipts climbed by 10.3 % YoY, driven by increased output of electronics, automotive components, and pharmaceuticals. This uptick mirrors the RBI’s forecast of a 3.5 % growth in manufacturing output for the last quarter of FY25. - Services: GST collections from services rose by 7.8 % YoY, with IT and BPO services posting the strongest performance. A significant factor was the return of foreign‑based clients after a temporary slowdown during the COVID‑19 wave. - Retail & E‑commerce: The retail sector recorded a 12.1 % YoY increase, reflecting a post‑pandemic surge in consumer spending, especially in the apparel and grocery categories. The CBIC highlighted a 6.5 % MoM rise in e‑commerce sales, which contributed significantly to the overall figures.

2. Growth Drivers and Policy Impact

The article cites a combination of macro‑economic and policy factors that underpinned the 9 % YoY jump:

a. Fiscal Consolidation Measures

The Finance Ministry’s “Fiscal Responsibility and Budget Management (FRBM) 2025–26” draft, released last month, earmarked ₹30 trillion for infrastructure development. This spending has spurred demand for construction materials, reflected in the 11 % YoY rise in the manufacturing of cement and steel.

b. GST Council's New Rate Rationalisation

During its March 2025 meeting, the GST Council reduced the tax rate on packaged foods from 12 % to 5 %. CBIC data indicates that this move has led to a 3.6 % lift in food‑sector collections. Similarly, a re‑assessment of the 28 % threshold for small‑scale exporters has simplified compliance for many SMEs, increasing export‑related GST revenue by 4.1 % YoY.

c. Digitalisation of Tax Compliance

The introduction of the “E‑Filing” portal for GST payments has reduced under‑reporting. The portal’s analytics show that the number of “high‑volume” taxpayers (those filing more than 100 returns per month) rose by 9.3 % in October, thereby tightening the tax net on large corporates.

d. COVID‑19 After‑shock Recovery

The RBI’s latest policy statement noted that the domestic consumption index (DCI) was at 1.4 % above its pre‑pandemic level. The CBIC’s data correlates this rise with a 15 % increase in the “consumer‑goods” tax receipts, suggesting that pent‑up demand is translating into higher tax collections.

3. Compliance and Audit Trends

The CBIC highlighted a 4.7 % increase in the number of GST audits conducted in October. “Audit efficiency” has improved thanks to the new AI‑based risk‑assessment tool launched in September. The article referenced an official press release that the Audit Unit will now focus on “high‑risk” sectors such as pharmaceuticals and automotive spare parts. Moreover, the number of “non‑compliant” taxpayers flagged by the system fell by 2.2 % YoY, indicating that compliance drives are bearing fruit.

4. Key Takeaways for Policymakers

1. Positive Correlation Between GST Collections and Economic Activity
   The 9 % YoY increase aligns closely with the growth figures in GDP (3.6 % for Q4 FY25) and industrial output (3.5 % for the same quarter). The data reinforces the notion that a healthy GST base is a reliable indicator of macroeconomic health.

2. Need for Continued Rate Rationalisation
   The benefits observed from the reduction in the food‑goods rate and the 28 % threshold adjustment suggest that further rationalisation could unlock additional revenue without hurting growth.

3. Digital Infrastructure as a Compliance Lever
   The success of the E‑Filing portal and AI‑based audits underscores the importance of sustained investment in digital tax administration.

4. Targeted Support for Exports
   While export‑related GST revenue has grown, the CBIC data shows a 1.8 % YoY decline in the “import‑related” tax segment. The article recommends revisiting the “in‑tra‑India” tariff policies to better balance trade flows.

5. Looking Ahead

The CBIC’s next release is scheduled for 15 December 2025 and will cover November collections. Analysts predict a modest 3–4 % YoY rise for that month, driven by the ongoing infrastructure spending cycle and the tail‑end effects of the current tax rate adjustments. The RBI’s upcoming Monetary Policy Review (scheduled for early January) will likely reference these GST figures as part of its assessment of fiscal‑monetary interplay.

The article ends by noting that while the current data showcases a robust GST base, “the true test will be whether these collections can sustain the projected fiscal deficit target of 3.5 % of GDP for FY26.” The CBIC’s continued focus on compliance, digitalisation, and rationalisation will play a crucial role in achieving that goal.

In Summary

The October 2025 GST collection figure of ₹1.89 trillion is more than a headline. It reflects the convergence of macroeconomic momentum, effective policy measures, and digital compliance reforms. The 9 % YoY rise not only strengthens the government's fiscal position but also signals that the Indian economy is still on a path of resilient growth. The next few months will reveal whether this trend holds, and whether the GST framework can adapt to the evolving demands of an increasingly complex, digital, and export‑oriented economy.