Festive Season Spree Boosts October GST Collections

In October, India's gross GST collection rose by 4.6% to approximately Rs 1.96 lakh crore, driven by festive shopping despite lowered GST rates. The festive season sales, spurred by pent-up demand and a significant tax rate cut announced by PM Modi before Diwali, influenced this increase.

In a significant boost to India's fiscal landscape, the gross GST collection in October surged to nearly Rs 1.96 lakh crore, marking a 4.6% increase from the previous year's October figures. This rise, spurred by festive season buying, comes despite a considerable reduction in GST rates on a wide range of items.

Since September 22, GST rates on 375 commodities, spanning kitchen staples to electronics, were slashed, aligning with the Navratri festivities, traditionally considered an auspicious time for new purchases. This strategic timing followed Prime Minister Narendra Modi's Independence Day pledge to reduce GST rates before Diwali, which impacted consumer purchasing decisions positively.

While the October collection reflects an upswing from August and September's subdued numbers, the growth rate is slower than the average 9% monthly increase seen previously. Notably, domestic revenue rose 2%, import tax surged by 13%, and GST refunds increased by 39.6% compared to the past year, culminating in a net GST revenue of Rs 1.69 lakh crore.

(With inputs from agencies.)