The low GST collections indicate the necessity for structural reforms.

Eighth Anniversary of Goods and Services Tax (GST) in India

• The eighth anniversary of GST in India coincided with the poorest tax collections in four months.

• The latest GST collections stood at ₹1.85 lakh crore in June 2025, the lowest in four months.

• The growth in the government’s actual collections was just 3.3% once refunds are accounted for.

• Domestic transaction revenue, excluding imports, was an anemic 4.6% higher than in June last year.

• The dip in GST collections reflects a dip in economic activity and inefficiencies in the system.

• A common demand is for fuel to be included in GST, but strong resistance from State governments.

• The Centre must accede to their request for a higher share in central taxes and stop increasingly relying on non-shareable cesses for its revenue.

• The GST Council’s fitment and rate-setting committees are examining the issue.

• The question is what to do with the GST Compensation Cess, which was originally intended to compensate States for losses arising out of GST implementation.

• The Centre should avoid the temptation to subsume this cess into the broader GST rates and remove it.