GST Collections Cross Rs 2 Lakh Crore for Second Straight Month; Rate Rationalisation Back in Focus

India’s gross Goods and Services Tax (GST) collection for May 2025 stood at Rs 2.01 lakh crore, according to data released by the Finance Ministry on Sunday. It registered a 16.4% year-on-year growth as compared to Rs 1.72 lakh crore collected in May 2024.

The year-on-year growth was driven by a 25.2% increase in GST collected from imports and a 13.7% rise from domestic transactions. Gross GST revenue from imports stood at Rs 51,266 crore, while domestic sources contributed Rs 1,49,785 crore.

“16% growth inGST collections in the month shows a renewed upward momentum after a few months of growth in the range of 11 to 12%. If the growth continues in this range for the next couple of months, it might provide the cushion for the Government to look at rate rationalisation, on which a lot of work has already been done,” says Pratik Jain, Partner, Price Waterhouse & Co LLP (PwC).

May marks the second consecutive month in which GST collections have remained above the Rs 2 lakh crore mark. The collections had surged by 12.6% to an all-time high of Rs 2.37 lakh crore in the previous month.

The net GST revenue for May, after refunds, stood at Rs 1,73,841 crore, up 20.4% compared to Rs 1,44,381 crore collected during the same period last year. Total refunds during the month stood at Rs 27,210 crore, down 4% year-on-year.

Meanwhile, gross domestic product (GDP) data released on May 30 showed that full-year consumption rebounded from the 5.6% growth witnessed in FY24. India’s economy met its 6.5% growth target, as growth touched the 7.4% mark in the January-March quarter.

In the Union Budget, the government projected an 11% increase in GST revenue for the year, estimating collections at Rs 11.78 lakh crore, including Central GST and compensation cess.