November 1, 2025

New Delhi is buzzing with good news on India’s GST front! Even after slashing tax rates on nearly 99% of items in early September, the government’s GST collections are rocking strong. This move, called structural rationalisation, simplified the tax slabs to mainly 5% and 18%, plus a special 40% for some items. "We are broadly aligned with budgeted revenues. Any deviation will be modest," said a top government official. Why is this such a big deal? Normally, cutting taxes could reduce revenue, but here the smart timing of the GST changes just before the festive season gave a big boost to local buying. Three-wheeler dispatches jumped 5.5%, two-wheeler sales shot up to 2.16 million in September, and even passenger vehicle dispatches hit 372,000 units! What’s more, air-conditioner sales doubled on the very day the new GST rules began, and TV sales went up by 30-35%. The government collected a whopping Rs 1.89 lakh crore as GST in September—a 9.1% rise from last year. Experts suggest that this strong collection streak likely continued in October too. "The strong GST collections during the festive season clearly show that people are spending and business activity remains healthy," said Amit Maheshwari, Tax Partner at AKM Global. But there’s a catch. After the festive frenzy fades, collections may soften. "Collections traditionally remain higher during festival season and December numbers will reflect the correct collection trend once the euphoria of the festivals settles down," added the official. Still, the government isn’t worried. They expect any shortfall to be "modest" and believe it will be balanced by higher-than-expected non-tax revenue. The exact shortfall will become clearer after December when post-festive data is in. To tighten things further, from November 1 new GST registration rules and stricter verification for high-risk cases are expected to stop fake bills and plug revenue leaks. Experts like Aditi Nayar, chief economist at ICRA say, "Given higher than budgeted non-tax revenues, and savings in expenditure, we believe the government may be able to stick to its fiscal deficit target of 4.4% of GDP." In short, India’s GST story is like a spicy mix: clever tax cuts, festive cheer, and smart reforms keeping things cooking just right for both businesses and the government’s pockets!

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Tags: Gst, Tax reform, India economy, Government Revenue, Festive season, Budget Estimates,