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In a sign of temporary adjustment pressures following the implementation of the GST 2.0 rate rationalisation, as many as 20 out of 36 States and Union Territories (UTs) recorded a contraction in theirGSTcollections for October 2025, marking the weakest monthly performance so far in the current finan
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The dip in GST collections in October is attributed to the transition effects of the new GST 2.0 rate structure, which came into effect on September 22, 2025. Businesses delayed invoicing and dispatches to pass on lower tax rates, impacting collections for the month.
Gross GST revenue rose by 4.6% year-on-year in October, a significant moderation compared to previous months. State GST collections grew by a modest 2%.
Himachal Pradesh (-17%), Jharkhand (-15%), Uttarakhand (-13%), Andhra Pradesh (-9%), Madhya Pradesh (-5%), Rajasthan (-3%), and Delhi (-1%) reported the steepest year-on-year falls in their GST collections for October.
No, some regions bucked the trend. Arunachal Pradesh (44%), Nagaland (46%), Ladakh (39%), Andaman & Nicobar Islands (30%), and Dadra & Nagar Haveli & Daman & Diu (10%) posted robust year-on-year growth. Karnataka and Telangana also rebounded with 10% growth each.
Economists expect GST collections to recover in November and December, driven by festive sales and the gradual normalisation of invoicing under the GST 2.0 regime. Policymakers are confident that reforms will sustain healthy revenue growth.
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