India's Goods and Services Tax (GST) collection growth has slowed to 3.2% in May, the lowest rate in six months, as the total revenue reached Rs 1,94,184 crore. This deceleration is primarily attributed to a decline in revenue from domestic transactions, which fell by 2.6% to Rs 1,34,530 crore.
Domestic Revenue Decline
The government attributed the slower growth to a one-off gain of Rs 10,000 crore in May 2025 from a telecom operator's spectrum allocation payment. Adjusting for this, officials indicated a 9% increase in the overall GST collection.
- Taxable Value of Goods: Increased by 27% to over Rs 40 lakh crore
- Gold and Precious Metals: Surged by 47% to over Rs 5.1 lakh crore
- Services: Taxable value rose by 22% to Rs 11.5 lakh crore
Import GST Growth
The Integrated GST (IGST) on imports rose by over 20% to more than Rs 60,000 crore in May. Key contributors included:
- Coal: Increased nearly five times to Rs 3,749 crore
- Memory Chips: Tripled
- Processing Units: Increased fivefold
"While import GST has recorded a near 20% growth, this may also be attributed to rupee depreciation. Adjusted for the one-time telecom payment in the base, domestic collections reflect moderate growth," said Abhishek Jain, Indirect Tax Head & Partner at KPMG.
Comparative Data
| Category | Growth Rate | Value (Rs crore) |
|---|---|---|
| Domestic Transactions | -2.6% | 1,34,530 |
| Import IGST | 20% | 60,000 |
| Gold and Precious Metals | 47% | 5,100 |
The government remains optimistic about consumption trends across various sectors, including agriculture, manufacturing, real estate, transport, consumer goods, and electronics, following the GST structure rationalization last September.
The next milestone to watch will be the upcoming GST collection report, which will provide further insights into the revenue trends and economic impact.
