ExplainedTax
GST at ₹2.31 lakh crore explained: why October jumped 22.9% and how much of it is imports
Gross GST collections for October rose at their fastest pace in months, with tax on imported goods up 42%. What the monthly number measures, why last year's weak October flatters the growth, and why a weaker rupee is part of the story.
The short answer
October's gross GST of ₹2,31,290 crore, up 22.9% on a year ago, rests on three things. Domestic collections, up 15.8%, are being compared with October 2025, when growth was the weakest of that year because buyers had put off purchases until the GST rate cuts of 22 September 2025. Tax on imports, up 42.2% to ₹72,246 crore, has been running far ahead of domestic tax for months, helped by a weaker rupee and higher commodity prices that raise the rupee value of everything brought in. And refunds grew only 6.5%, so net revenue rose even faster, by 25.6%, to ₹2,03,356 crore.
What does the monthly GST number measure?
The tax businesses paid to the government in that month, mostly on sales made the month before. A trader who sells goods in September files a return and pays the tax in October, so the October collection is largely a picture of September’s business. That matters this year. With Diwali on 8 November, most of the festive shopping happened in October, and it will show up mainly in the November figures, not these.
The headline number, gross GST, adds up three parts: central GST and state GST on sales within a state, and integrated GST (IGST) on sales between states and on imports. In October central GST brought in ₹42,935 crore, state GST ₹51,340 crore and IGST ₹1,37,015 crore. Of that IGST, ₹72,246 crore was paid on goods arriving from abroad.
Why did October grow so fast?
Partly because October 2025 was unusually weak. The GST rate cuts known as GST 2.0 took effect on 22 September 2025. Many buyers and businesses held back purchases in early September last year to get the lower rates, especially on cars and other costly goods, so only the last eight days of that month were billed at the new rates.
The result was that gross GST in October 2025 grew just 4.6%, the slowest of that financial year, and collections fell in 20 of 36 states and Union Territories. Abhishek Jain, a partner at KPMG, said at the time that deferred purchases in high-value sectors made the month look softer than it really was.
Measured against that low base, this year looks especially strong. Maharashtra’s collections, which grew 3% last October, are up 13% this time. Haryana went from no growth to 17%.
Why is GST on imports growing so much faster?
Because everything India buys from abroad now costs more in rupees. GST on imports rose 42.2% to ₹72,246 crore, against 15.8% growth in domestic GST. This is not a one-month blip. In September import GST grew about 26%, while domestic GST grew about 10%.
GST on imports is charged as a percentage of the value of the goods. When the rupee weakens, the same dollar price converts into more rupees, and the tax goes up with it. Manoj Mishra of Grant Thornton Bharat explained the September figures in these terms: “Rupee depreciation has increased the landed rupee value of dollar-denominated imports.” He also pointed to higher crude and commodity prices and stronger imports of electronics, machinery, gold and fertilisers. With the Strait of Hormuz still shut and Brent crude above $113 a barrel, those price pressures have not eased.
October GST, this year against last
Does more import GST mean more money for the government?
Not all of it stays with the government. A registered business that pays IGST when its goods arrive can usually claim that tax back as a credit when it sells the goods in India. So part of today’s import GST will be set off against tax that would otherwise have been paid in cash later. That is why tax experts read the import number with care. Pratik Jain of Price Waterhouse & Co noted in September that a large part of the headline growth was coming from imports rather than from domestic activity.
What is the difference between gross and net GST?
Net GST is what is left after refunds. Refunds go mainly to exporters, who are not meant to pay GST on goods sold abroad, and to businesses that pay a higher rate on their inputs than on what they sell. In October refunds rose only 6.5% to ₹27,934 crore, much slower than collections. That is why net revenue grew 25.6% to ₹2,03,356 crore, faster than gross revenue. Net GST linked to imports grew 56.2%.
What does it mean for the year?
The Centre and the states are ahead of last year. Gross collections from April to October reached ₹14,77,569 crore, up 13.2%, and net revenue ₹12,69,486 crore, up 12.6%. The October jump will help both sides plan spending for the rest of the year.
The harder question is how much of it will last. The low base from last October will not repeat in November, and the import boost depends, as Mishra put it, on commodity prices, the rupee and import volumes. November’s figures, due on 1 December, will be the first test of how much of October’s growth came from real demand.