The monthly gross goods and services tax (GST) collections for November–December (October and November transactions) came in 10.8% below the monthly average observed during the April–October period, reflecting the initial impact of the GST rate rationalisation.
The average GST collections in November–December stood at ₹1.77 lakh crore (including cess), which was ₹21,431 crore below the monthly average of ₹1.98 lakh crore observed during the April–October period. The November–December figures represent the first two full months of GST collections under the post-rationalisation regime (reflecting October–November activity).
Including compensation cess, the November–December period recorded a 1.3% year-on-year (y-o-y) decline in gross GST mop-up, underscoring the immediate revenue trade-off from sweeping rate cuts.
The GST 2.0 reforms, approved by the GST Council in September 2025, simplified the slab structure primarily to 5% and 18%, with a 40% rate for luxury and sin goods, abolishing the 12% and 28% brackets. This move aimed to boost consumption, reduce compliance burdens, and align rates more rationally, but led to short-term moderation in domestic revenues.
Cumulatively, GST collections recorded a growth of 9% year-on-year in the April–October period. In the November–December period, GST growth excluding cess was 3.37%. In November, total collections, including cess, contracted 4% to ₹1.75 lakh crore, while in December, mop-up grew 1.3% to ₹1.79 lakh crore.
The Centre has projected GST collections of ₹11.78 lakh crore for FY26, comprising ₹10.1 lakh crore Central GST and ₹1.67 lakh crore compensation cess. The projection represents a 14.8% growth over FY25 provisional figures.
Madhavi Arora, Chief Economist at Emkay Global, said there could be GST revenue slippage of 0.25% of gross domestic product (GDP) for the Centre in FY26. She added that actual growth in the Centre’s GST revenues in the current financial year could be around 6%.
The government has targeted the fiscal deficit at 4.4% of GDP for FY26.
Manoj Mishra, Partner and Tax Controversy Management Leader at Grant Thornton Bharat, said that the overall GST revenue growth (Centre and states) for FY26 should moderate to around 4–6%, taking aggregate collections to roughly ₹22–23 lakh crore. In FY25, total collections stood at ₹22.08 lakh crore. For the January–March period, Mishra projected average monthly GST mop-up of ₹1.8–2 lakh crore.
Saurabh Agarwal, Tax Partner at EY India, said that as long as monthly collections remain resilient within the ₹1.7–1.8 lakh crore range, the trajectory remains firmly in line with expectations.
Mishra noted that even with the recent moderation, gross GST revenues in the first nine months of FY26 have still grown by about 8.6% to nearly ₹16.5 lakh crore, reflecting how an elevated revenue base has boosted buoyancy over recent years. The system is now transitioning from rapid expansion to more mature, sustainable growth, he added.
With domestic demand and industrial activity holding firm, any revenue slippage is more likely to be cyclical rather than structural, implying a limited and manageable impact on the fiscal deficit path, Mishra said.
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