Goods and Services Tax (GST) collections in India rose to Rs 1.77 lakh crore in December 2024, marking a 7.3% increase compared to December 2023, when collections stood at Rs 1.65 lakh crore. This data, released on January 1, 2025, shows that GST collections have remained above Rs 1.7 lakh crore for ten consecutive months, indicating steady economic activity.
Despite the year-on-year growth, December’s GST collections were below the peak of Rs 2.1 lakh crore recorded in April 2024. The growth rate for December was also the slowest in three months, reflecting a seasonal dip after the festive period.
Saurabh Agarwal, Tax Partner at EY India, commented, “The slight slowdown in GST collections is typical post-holiday season and aligns with expectations as consumer spending has moderated in recent months.”
Quarterly Growth Indicates Economic Stability
In fact, GST collections averaged Rs 1.82 lakh crore during the October-December quarter, higher than the average of Rs 1.77 lakh crore in the July-September quarter. On a yearly basis, GST revenues in the December quarter were up 8.3% from the year-ago period, indicative of improving economic performance.
The growth rate of the Indian economy slowed down in the second quarter, contracted to 5.4 percent-the lowest in seven quarters-from 6.7 percent in the April-June period. But the Reserve Bank of India expects the economy to grow by 6.6 percent in FY25 on the back of better tax collections.
The net GST revenue in December stood at Rs 1.54 lakh crore, a gain of just 3.3% over the year-ago period as refunds on imports outpaced domestic refunds. The net domestic revenue grew 6.7% at Rs 1.21 lakh crore while net customs revenue fell 7.3% on year.
Refunds for domestic production surged by 31 percent compared with previous years as the figure for import-related refunds swelled by a whopping 64.5%. These trends corroborate the ‘Atmanirbhar Bharat’ thrust of the government on local production. “Increasing trend of domestic refunds and reduction in import dependency demonstrate India’s move toward self-sustenance,” added Agarwal, elaborating that this is beneficial for the long-term goals of the country in terms of sustained economic growth.
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Source: Moneycontrol
News Desk
