A sharp increase in tax revenue from imports helped net goods and services tax (GST) collections of central and state governments, after accounting for refunds, rise 25.6 per cent year-on-year to ₹2.03 trillion in October, marking the highest growth rate in the current financial year, according to provisional data released by the finance ministry on Sunday.
Gross GST collections also recorded their fastest growth in the current financial year, rising 22.9 per cent year-on-year to ₹2.31 trillion.
In absolute terms, both gross and net GST collections were the second-highest in the current financial year, after touching ₹2.42 trillion and ₹2.10 trillion, respectively, in April.
Gross GST collections crossed the ₹2 trillion mark for the fourth time in the first seven months of FY27, following April, July and September. Net GST collections crossed the mark for the second time, after April, when collections stood at ₹2.10 trillion.
The latest increase in net GST revenue follows growth of 18.1 per cent in September, 8.3 per cent in August and 15.8 per cent in July.
Import-linked GST revenue continued to outpace domestic collections. Gross integrated GST (IGST) revenue from imports rose 42.2 per cent year-on-year to ₹72,246 crore in October, accounting for nearly a third of total gross GST collections.
After adjusting for refunds, net GST revenue from imports increased 56.2 per cent to ₹58,319 crore.
Gross domestic GST revenue rose 15.8 per cent to ₹1.59 trillion during the month, while net domestic collections increased 16.4 per cent to ₹1.45 trillion.
Vivek Jalan, partner at Tax Connect Advisory Services, said October 2026 collections assumed significance as October 2025 was the first full month in which the impact of GST 2.0 rate rationalisation was reflected in revenue numbers.
The 15.8 per cent growth in gross domestic GST revenue to ₹1.59 trillion indicated rising consumption demand and higher economic activity, while the 42.2 per cent increase in GST collections from imports pointed to higher procurement of raw materials and intermediate goods, reflecting an expansion in domestic manufacturing and capacity utilisation, he said.
Jalan added that the GST Council’s recent decisions to liberalise input tax credit provisions and allow refunds of input tax credit on input services and capital goods under inverted duty structures were well-timed. These measures could improve industrial competitiveness, support exports, stimulate fresh investment and strengthen the country’s growth momentum, he said.
Total refunds increased 6.5 per cent to ₹27,934 crore in October, compared with ₹26,225 crore a year earlier. Domestic refunds rose 9.8 per cent to ₹14,007 crore, while refunds related to exports through ICEGATE, the customs electronic data interchange platform, increased 3.4 per cent to ₹13,927 crore.
Saurabh Agarwal, tax partner at EY India, said the sustained growth in import-linked collections underscored the need to further strengthen domestic manufacturing capabilities.
While production-linked incentive (PLI) schemes had delivered encouraging outcomes in select sectors, it might be time to revisit and recalibrate schemes in sectors with unutilised budgets to better support the objective of an Atmanirbhar Bharat, he said.
Agarwal also pointed to broad-based growth across states, including Rajasthan, Jammu and Kashmir, Bihar, Manipur, Mizoram, Assam, Meghalaya, Jharkhand and Madhya Pradesh. He expected festive-season demand to keep collections strong in the coming month and urged businesses to maintain robust compliance and reconciliation processes.
Abhishek Jain, partner and national head of indirect tax at KPMG in India, said the October collections reflected sustained economic activity, improved tax compliance and the resilience of India’s consumption and trade ecosystem.
“The October numbers provide a positive signal for revenue mobilisation and reinforce the growing maturity of India’s GST framework,” he said.
For the April-October period, gross GST collections grew 13.2 per cent to ₹14.78 trillion, compared with ₹13.05 trillion in the corresponding period of the previous financial year. Net GST revenue increased 12.6 per cent to ₹12.69 trillion, from ₹11.27 trillion a year earlier.
Import-linked collections continued to outperform domestic revenue during the seven-month period. Gross GST revenue from imports rose 29.3 per cent to ₹4.44 trillion, while net revenue from imports increased 34.1 per cent to ₹3.54 trillion. In comparison, gross domestic GST revenue grew 7.4 per cent to ₹10.33 trillion, while net domestic collections rose 6 per cent to ₹9.15 trillion.
Total refunds during April-October increased 16.9 per cent to ₹2.08 trillion, from ₹1.78 trillion in the corresponding period last year.
