GST Growth Slows to 7.3% in December

India’s GST collection growth slowed to 7.3% YoY in December 2024, with gross revenue standing at ₹1.77 lakh crore, compared to ₹1.65 lakh crore in December 2023. This marks the slowest growth in three months and highlights a slight decline in consumer spending post-holiday season. GST revenues have consistently stayed above ₹1.7 lakh crore for ten consecutive months, with the December quarter averaging ₹1.82 lakh crore—8.3% higher YoY.

Gross and Net Revenue Breakdown

• Domestic Transactions: Grew 8.4% YoY to ₹1.32 lakh crore in December.
• Imports: Revenue from imports grew at a slower rate of 3.9% to ₹44,268 crore.
• Net GST Collections: Slower growth of 3.3% YoY to ₹1.54 lakh crore, driven by higher refunds—domestic refunds surged 31%, while import refunds soared 64.5%.

State-Wise Revenue Performance

Most large states registered single-digit growth in GST collections:

• Highest Performers: Tamil Nadu (11%) and Telangana (10%) showed double-digit growth.
• Moderate Growth: Maharashtra (9%), Rajasthan (8%), and Karnataka (7%).
• Low Growth: Gujarat (4%), Bihar (2%), Uttar Pradesh and Madhya Pradesh (1% each).
• Decline: Andhra Pradesh saw a contraction of 6%.

Economic Implications and Trends

• The slower GST growth is consistent with India’s economic performance, as GDP growth dropped to 5.4% in Q2 FY25 compared to 6.7% in Q1.
• Experts, including Saurabh Agarwal of EY India, attribute this slowdown to reduced consumer spending. However, the focus on domestic production under the “Atmanirbhar Bharat” initiative aligns with the rising domestic refunds, indicating reduced import reliance.
• RBI projects a GDP growth of 6.6% for FY25, supported by resilient GST revenues.

Summary of the news