India’s Goods and Services Tax (GST) collections rose by 7.5 percent in July 2025, with the gross revenue touching ₹1.96 lakh crore, according to data released by the Union Ministry of Finance. This figure represents another month of stable indirect tax growth, supported by strong domestic transactions and steady economic activity across sectors.

Out of the total collections, the gross domestic GST revenue stood at ₹1.43 lakh crore, showcasing healthy tax receipts from domestic consumption and services.

This sustained increase reflects the continued strength of India’s economic recovery and compliance ecosystem, providing a solid fiscal base for the Centre and State governments.

Monthly collection snapshot

According to the Ministry, the GST revenue for July 2025 comprises:

• CGST (Central GST): ₹35,900 crore

• SGST (State GST): ₹30,100 crore

• IGST (Integrated GST): ₹99,000 crore (including ₹45,000 crore from imports)

• Cess: ₹21,000 crore (including ₹4,200 crore from imports)

The Ministry also confirmed that ₹42,500 crore was settled to CGST and ₹35,600 crore to SGST from IGST collections. After settlement, the total revenue for Centre and States stood at ₹78,400 crore and ₹65,700 crore respectively for the month of July.

These numbers indicate a stable and broad-based growth in GST receipts, especially in sectors like manufacturing, e-commerce, logistics, construction, hospitality, and financial services.

Comparison with previous year

The July 2025 revenue is 7.5% higher than the ₹1.82 lakh crore collected in July 2024. While the pace of growth has moderated compared to the double-digit increases seen in earlier months, the year-on-year expansion remains strong and consistent, indicating both macroeconomic resilience and improvement in tax compliance.

A senior finance ministry official said, “The increase in domestic revenue collection to ₹1.43 lakh crore is particularly encouraging. It shows that India’s consumption-led recovery is well on track, and businesses are showing improved adherence to GST norms.”

Sector-wise collection trends

Though detailed sector-wise data is expected later, preliminary estimates indicate that key contributors to the July 2025 GST revenue include:

• Manufacturing and consumer goods, boosted by festive season inventory buildup

• Automobile sales, which continued to show robust double-digit growth

• Telecom and financial services, driven by digital payment ecosystem

• Construction and infrastructure projects, fuelled by government-led capex

• E-commerce and online services, maintaining upward trends in sales tax compliance

Exports, however, saw marginal moderation, though this was offset by strong domestic consumption and input tax credits claimed by exporters.

Compliance and enforcement efforts

The steady revenue performance in July was also aided by improved compliance monitoring by GSTN (Goods and Services Tax Network) and enhanced use of data analytics by the Directorate General of GST Intelligence (DGGI).

Officials stated that the July growth reflects not only higher economic activity but also better invoice matching, automated return filing, and enforcement action against fraudulent input tax credit claims.

During the month, the government continued targeted verification of high-risk taxpayers, along with e-invoicing integration for medium-sized businesses, which has reduced tax evasion and improved accuracy in reporting.

GSTN also rolled out improved AI-based return filing assistance tools, which helped businesses reduce errors and speed up compliance procedures.

Performance across States

State-wise GST collection reports show strong performance from industrialised States like Maharashtra, Gujarat, Karnataka, Tamil Nadu, and Uttar Pradesh. Maharashtra alone accounted for over ₹22,000 crore of GST in July 2025, while Gujarat and Karnataka reported monthly collections above ₹16,000 crore each.

States in eastern India, including Bihar, Odisha, and Jharkhand, also showed notable year-on-year increases, largely driven by infrastructure projects, mining output, and service sector growth.

Northeast States like Assam and Tripura registered double-digit GST growth on a lower base, with focus on tax registration drives and digital billing systems for SMEs and traders.

Domestic vs Import-based revenue

The breakup of ₹1.96 lakh crore GST revenue includes ₹1.43 lakh crore from domestic transactions (including services) and ₹53,000 crore from imports of goods and services, showing a balanced contribution.

The robustness in domestic revenue reflects sustained consumption within the country, even as imports remain moderately high, particularly of capital goods, electronic items, and intermediate industrial inputs.

Experts say this combination of domestic and import-based GST collection demonstrates the depth of India’s internal supply chains and production base, even as global supply chains face headwinds.

Impact on Centre-State finances

This steady GST growth offers fiscal breathing space for both Centre and States. For the Centre, higher indirect tax receipts reduce reliance on direct tax mobilisation and offer scope for continuing infrastructure investment and social sector spending.

For States, regular and predictable GST settlement improves liquidity, allowing them to meet developmental commitments without resorting to excessive borrowing.

The GST Council, which met last month, is reportedly considering further reduction in tax disputes and simplification of compliance norms, especially for MSMEs. A sub-committee has been formed to examine rationalisation of slabs and potential merger of 12% and 18% brackets, subject to revenue neutrality.

Outlook for coming months

Economists expect GST revenue to remain strong in the upcoming months, with potential for crossing ₹2 lakh crore during peak festive season (October–November 2025). Aided by:

• Back-to-school and festival spending

• New launches in auto and electronics

• Agricultural produce movement post-harvest

• Holiday-related hospitality and services boom

Policy experts, however, caution against complacency, highlighting that inflationary pressures and global uncertainties could affect demand in the latter half of FY26.

“Monsoon-related agricultural impact, interest rates, and international oil prices will need to be monitored,” said a report by CRISIL Research.

Conclusion

The July 2025 GST revenue of ₹1.96 lakh crore, marking a 7.5% year-on-year increase, demonstrates the Indian economy’s sustained momentum and the effectiveness of the evolving GST framework. The healthy domestic contribution of ₹1.43 lakh crore is especially reassuring.

As India heads into a crucial period of consumption and investment, consistent GST growth offers policymakers more options, both in terms of budgeting and reforming the tax system further. With rising economic formalisation, continued tech integration, and better inter-state coordination, the GST regime appears firmly on the path of maturity and optimisation.

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