GST Crosses Rs 2 lakh Crore Again. The Growth Is Real, But So Is The Import Effect
By A Special Correspondent
First publised on 2026-10-02 13:27:45
About the Author
India's gross GST collection rose 14.7 per cent to Rs 2,03,521 crore in September, against Rs 1,77,365 crore a year earlier. It is the third month of this financial year to cross Rs 2 lakh crore, after April (about Rs 2.43 lakh crore) and July (Rs 2.11 lakh crore). August fell just short at Rs 1,99,853 crore. The mark is being crossed often. It is not yet a floor.
The headline is accurate. Its composition needs reading. Gross domestic revenue rose 10.1 per cent to Rs 1,37,996 crore. Import-related revenue rose 25.9 per cent to Rs 65,525 crore. Imports make up about a third of the total, but import-related revenue rose by about Rs 13,500 crore, roughly half of the Rs 26,156 crore increase in gross collections over September 2025. Net GST revenue rose 18.1 per cent to Rs 1,76,520 crore, because refunds fell 3 per cent to Rs 27,001 crore.
The pattern is not confined to one month. For April to September, gross collection rose 11.6 per cent to Rs 12,46,278 crore. Over the same half-year, domestic revenue grew 6.1 per cent and import revenue 27.1 per cent. Net domestic revenue grew only 4.3 per cent. Measured against that, September's 10.1 per cent domestic growth is a better month than the half-year average. It is still well below the headline.
What is driving the increase
Imports. Import-related revenue is the most striking component of the increase. Import IGST grew 25.9 per cent in September and has been growing at a similar pace all year. The release does not separate how much of that reflects higher volumes, higher prices or currency movements, so the data cannot say how much of it signals demand.
Domestic transactions. Growth is broad but uneven. Maharashtra's domestic collection rose 15 per cent to Rs 29,986 crore. Karnataka rose 16 per cent, Uttar Pradesh and Telangana 18 per cent each, and Gujarat's domestic collection rose 17 per cent to Rs 12,222 crore. West Bengal grew 6 per cent, Tamil Nadu fell 5 per cent and Rajasthan was flat.
Refunds and compliance. Domestic refunds fell 13.5 per cent, which is why net domestic revenue grew 13.5 per cent against 10.1 per cent gross. Cumulative refunds for the half-year are up 18.8 per cent, so a single month's dip may be a matter of timing. Compliance is another likely contributor. Wider use of e-invoicing, data analytics and registration checks has narrowed the scope for under-reporting and fake invoicing. The September data does not allow the contribution of compliance to be isolated.
What the numbers do not say
They do not show that the GST rate rationalisation announced in September 2025 has already lifted volumes. Collections in September 2025 mostly reflected August 2025 transactions, while the revised rates took effect only on 22 September. The real test of the new structure lies ahead, as collections begin to capture a full year of transactions under it. Comparisons will also soften. October 2025 collections grew only 4.6 per cent, so the coming months are measured against a modest base. September is strong, but it is not a record, and it is not proof that domestic demand is booming.
The months ahead
The coming months favour the exchequer. Navratri, Durga Puja, Dussehra and Diwali are concentrated in October and early November, and the wedding season follows. Gold, apparel, vehicles, appliances, catering, travel and gifting are all heavy GST categories. Collections in a month largely reflect the previous month's transactions. October's figure will capture September activity, and the festive sales will show up most clearly in the November and December releases. If festive demand turns into taxable sales and domestic growth holds around September's pace, the Rs 2 lakh crore mark could begin to look less like a milestone and more like a settled level.
