GST revenue tops Rs.1.94 lakh crore in May, driven by broad-based growth in consumption
Collection from Goods & Services Tax (GST) in May rose 3.2 per cent to over Rs.1.94 lakh crore, the government reported on Monday.
Collection in May is related to goods consumed and services availed in April. According to GST portal, May 2025 GST Revenue includes Rs. 10,000 crores of one-time payment made by a telecom operator for spectrum allocation. Adjusted for this one-time payment, Gross GST Revenue grew 9 per cent in May 2026 with Domestic Gross GST growth being 5 per cent.
Broad-based growth across goods sectors
According to government sources, growth was broad-based across good sectors. “Goods sector taxable supply grew 26.9 per cent in April, with positive growth recorded across all 27 commodity groups, confirming the breadth and durability of domestic demand,” a source said. It rose to Rs.40.10 lakh crore as against Rs.31.61 lakh crore during the corresponding period of the last fiscal. “Taxable supply is a good proxy for consumption in the economy. This growth is not concentrated in any single segment but spans agriculture, manufacturing, chemicals, metals, electronics, and consumer goods simultaneously,” another source said.
Services sector shows structural resilience
Talking about the services sector, sources said taxable supply grew 22.2 per cent to over Rs.11.50 lakh crore in April 2026-27, with every major service category registering positive growth, demonstrating structural resilience in domestic consumption. “All major service categories are in positive growth territory,” the second source said while adding that the strong showing in real estate, construction, and transport further corroborates the investment and consumption narrative, he added.
Import-linked IGST emerges as standout performer
IGST on imports grew by a robust 20.2 per cent in May 2026, rising from Rs.50,070 crore to Rs.60,166 crore, reflecting strong momentum in the last few months. This is the standout performer in the revenue mix. The bulk of this import growth is driven by raw materials and intermediate inputs that feed India’s industrial production chain. “
Refunds remain strong, net collections up 10.1%
Adjusted Net GST collections (after refunds) have grown at 10.1 per cent. Refund disbursements have remained robust, reflecting the government’s commitment to improving ease of compliance for exporters and manufacturers. “Initiatives such as automated refunds for IDS and exports have ensured that legitimate refund claims are processed efficiently and without unnecessary delay,” the second source said.
Experts’ take
According to Pratik Jain, Partner at Price Waterhouse, collectively for April and May 26, collections show a robust 8.8 per cent growth on likes to like basis. This is despite the steep rate cuts from September 2025 and geopolitical disruptions for last couple of months. Imports as well as domestic consumption of products and services have expanded significantly, which shows our economic resilience.
“Given the increase in input costs due to supply chain issues, this might be a right time for Government to consider providing working capital support to industry by relaxing refund provisions with respect to input GST, which has been accumulating for many businesses,” he suggested
Vivek Jalan, Partner at Tax Connect Advisory too calls for the urgent need for structural changes in GST. The upcoming GST Council meeting must address deepened inverted duty structures, particularly refunds on input services, which continue to distort competitiveness. “Bringing petroleum products under GST would be a landmark reform to rationalize tax incidence and reduce cascading effects. Equally important is easing the refund process with clear, transparent guidelines — especially around tagging certain taxpayers as ‘risky’ — so that genuine businesses are not burdened by delays,” he said.
