India’s Goods and Services Tax (GST) collections for December 2024 surged to an impressive ₹1.77 trillion (US$ 20.70 billion), showcasing a 7.3% year-on-year growth compared to December 2023. This marks the tenth consecutive month of collections exceeding ₹1.7 trillion, underlining the resilience of the Indian economy despite global and domestic challenges.

GST Revenue Breakdown

In December 2024, the GST revenue was derived from four primary components:

• Central GST (CGST): ₹32,836 crore (US$ 3.84 billion)
• State GST (SGST): ₹40,499 crore (US$ 4.74 billion)
• Integrated GST (IGST): ₹47,783 crore (US$ 5.59 billion)
• Cess collections: ₹11,471 crore (US$ 1.34 billion)

Domestic transactions alone contributed a substantial ₹1.32 trillion (US$ 15.44 billion), reflecting an 8.4% growth compared to the previous year. Meanwhile, GST from imports grew by 4% YoY to ₹44,268 crore (US$ 5.18 billion).

Refunds and Net Collections

The government issued refunds worth ₹22,490 crore (US$ 2.63 billion) in December, a 31% YoY increase, improving taxpayer compliance and enhancing efficiency in tax administration. Consequently, net GST collections rose by 3.3% to ₹1.54 trillion (US$ 18.01 billion).

Comparison with Previous Months

Despite the robust December performance, the collections fell short of the record ₹2.1 trillion (US$ 24.56 billion) in April 2024 and the ₹1.82 trillion (US$ 21.29 billion) recorded in November 2024. November's GST revenues were bolstered by a 9.4% growth in domestic transactions and a 6% increase in import-related GST.

Economic Implications

The consistent rise in GST collections reflects improved compliance and economic activity, even as India’s GDP growth slowed to 5.4% in Q2 FY2024-25, the lowest in seven quarters. The government’s focus on enhancing digital tracking of transactions and reducing tax evasion has contributed significantly to revenue growth.

Future Outlook

While December’s GST collections indicate strong economic momentum, sustaining these levels will require continued reforms, increased digitization, and proactive measures to support businesses amidst potential headwinds.

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