Why are some Indian states seeing a decline in GST collections in 2025?

States are experiencing declining GST collections due to factors like slowing demand, increased refunds, and tighter input tax credit controls, impacting domestic GST.

Which major states have recorded a fall in GST revenue?

Major states like Tamil Nadu, Kerala, Odisha, and Madhya Pradesh have recorded a decline in GST collections between April and November 2025.

What is driving GST growth in India despite state-level slowdowns?

National GST growth is largely driven by import IGST and settlements flowing to major consumption and logistics hubs, masking struggles in domestic GST for many states.

Home / Business and Economy / GST Growth Slows: Half of States See Revenue Contraction

GST Growth Slows: Half of States See Revenue Contraction

7 Jan

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Summary

Nine states recorded a decline in GST collections from April to November 2025.
National GST growth held steady, but domestic GST faced pressure from refunds.
States with strong manufacturing and logistics outperformed others.

GST Growth Slows: Half of States See Revenue Contraction

Several major Indian states have reported a decrease in Goods and Services Tax (GST) collections during the fiscal year leading up to November 2025. Data reveals that nine out of twenty-four analyzed states and union territories experienced a contraction in their GST revenue compared to the previous fiscal year. This trend suggests underlying issues affecting revenue generation across a significant portion of the country.

Manoj Mishra noted that while the national GST figures showed resilience, growth has been driven by import IGST and settlements in a few key consumption hubs. Conversely, net domestic GST collections have been impacted by increased refunds and more stringent input tax credit regulations, leading to sluggish growth or contraction in many states.