Tax experts seek GST refund reforms, petroleum inclusion under GST as collections stay resilient
New Delhi [India], June 1 (ANI): Tax experts have called for structural reforms in the Goods and Services Tax (GST) framework, including easing input tax refund provisions, addressing inverted duty structures, and bringing petroleum products under GST, even as collections remained strong in May 2026. Experts stated that the latest GST collection figures reflect the continued resilience of the Indian economy despite geopolitical disruptions and rising input costs. However, they emphasized the need for policy measures to improve liquidity and simplify compliance for businesses.
Pratik Jain, Partner at Price Waterhouse & Co LLP, said that with the rise in input costs due to supply chain challenges, this may be the right time for the government to provide working capital support to industries by relaxing refund provisions related to input GST, which has been accumulating for many businesses.
According to official data, gross GST collections increased by 3.2 per cent year-on-year to Rs 1,94,184 crore in May 2026. Meanwhile, cumulative collections for the current financial year rose by 6.2 per cent to Rs 4,36,887 crore.
Vivek Jalan, Partner at Tax Connect Advisory Services LLP, also highlighted the need for broader GST reforms. He stated that the upcoming GST Council meeting should address deepened inverted duty structures, especially refunds on input services, which continue to affect competitiveness. He further said that bringing petroleum products under GST would be a landmark reform that could rationalize tax incidence and reduce cascading effects.
Jalan also stressed the importance of a simpler and more transparent refund mechanism, particularly concerning the classification of certain taxpayers as “risky”, so that genuine businesses do not face unnecessary delays in receiving refunds.
Meanwhile, Manoj Mishra, Partner and Tax Controversy Management Leader at Grant Thornton Bharat, noted that GST collections have continued to remain close to the Rs 2 lakh crore mark even without extraordinary revenue support. According to him, this reflects the growing maturity and stability of the GST regime in India.
Experts believe that while GST revenues continue to remain strong, additional policy reforms focused on improving refunds, reducing tax distortions, and easing business liquidity will be crucial in sustaining growth and strengthening the overall tax ecosystem in the coming years.
