October GST Collection Rises 4.6% to ₹1.95 Lakh Crore Despite Rate Cuts, Driven by Festive Demand

India’s Goods and Services Tax (GST) revenue for October 2025 rose to ₹1.95 lakh crore, marking a 4.6% year-on-year increase despite recent tax rate reductions announced in September. The data, released by the Ministry of Finance on Saturday, reflects a resilient consumption trend across key sectors during the festive season.

In October 2024, GST collections had stood at ₹1.87 lakh crore. According to the latest figures, Central GST (CGST) contributed ₹36,547 crore, State GST (SGST) accounted for ₹45,134 crore, and Integrated GST (IGST) stood at ₹1,06,443 crore. An additional ₹7,812 crore was collected as cess, primarily from sin goods such as tobacco and luxury products.

The Ministry noted that cess collections dropped by over 30% compared to September, largely due to the phasing out of the compensation cess under the new GST 2.0 framework, which continues to apply only to select goods.

💬 Expert Insights

Tax expert Vivek Jalan, Partner at Tax Connect Advisory Services, said the latest data highlights a balance between tax cuts and consumer demand.

“Even after the GST 2.0 rate cuts, the 0.6% growth in total net GST revenue reaffirms that the boost in consumption has, to some extent, offset the revenue decline caused by the rate reductions,” Jalan explained.

He added that the data reflects a release of pent-up consumption following the August 15, 2025 rate cut announcement, particularly evident during the festive buying surge.

📈 Month-on-Month Comparison

Gross GST collections also improved month-on-month, rising 3.6% from ₹1.89 lakh crore in September. Refunds, however, declined by 6%, falling to ₹26,934 crore from ₹28,657 crore in the previous month.

While growth momentum continued, the pace of increase slowed compared to September’s 9.1% surge, which marked a four-month high.

🛍️ Festive Season Boost

The October growth was largely driven by festive season consumption and rate rationalization, with strong sales recorded across automobiles, FMCG, electronics, and rural markets.

Although most states witnessed a moderate year-on-year decline due to the rate cuts, smaller states and union territories like Arunachal Pradesh, Nagaland, Lakshadweep, and Andaman & Nicobar Islands posted double-digit growth in GST receipts, signaling localized spikes in consumption.