GST collections in September: After the implementation of the GST reform, the government’s revenue has appeared positively. State governments earlier feared that the rate cuts would negatively impact the collection, but the September 2025 figures prove this fear wrong. The new rates came into effect from 22 September and heavy purchases in the festive season brought the GST collection to a record level.

GST collection increased

In September 2025, the GST collection increased by 9.1 percent to Rs 1.89 lakh crore. Comparison, it was Rs 1.73 lakh crore in September 2024 and Rs 1.86 lakh crore in August 2025. Gross domestic revenue increased by 6.8 percent to Rs 1.36 lakh crore and import tax increased by 15.6 percent to Rs 52,492 crore.

With this, GST refund also increased by 40.1 percent to Rs 28,657 crore on an annual basis. In September 2025, the net GST revenue was Rs 1.60 lakh crore, which is five percent more than the previous year.

Tax rates were cut on 375 items under GST 2.0 reforms, including kitchen goods, electronic items, medicines, equipment and motor vehicles. The direct impact of these changes has been seen as relief to the common consumers and the government as better revenue growth.

Perfect treasure of government

Minister of State for Finance Pankaj Chaudhary on Monday expressed confidence that the recent Goods and Services Tax (GST) reforms will increase the market shopping and will speed up the domestic economy. He said this while interacting with local businessmen, entrepreneurs and tax experts in Indore.

On this occasion, Chaudhary said, “Prime Minister Narendra Modi believes that when the GST reforms will provide extra money in the hands of the common people, it will increase the purchase in the market and the economy will gain momentum.” He further said that the GST system led by Prime Minister Modi was implemented in 2017, although the preparation was going on about 10 years ago.

Targeting the Congress -led United Progressive Alliance (UPA) government, Chaudhary said that the government of that time could not succeed in implementing the GST system as the public and the state governments did not trust that government. He alleged that due to lack of credibility of the then government, the state governments could not be ready for the GST system.

GST couricil meeting: The two -day meeting of the GST Council is going to be held from Wednesday. The country and the world have a special eye on this meeting being held ahead of time. Because after the announcement of PM Modi of GST Reform, steps will be taken in that direction. In this, ambitious changes in Goods and Services Tax (GST) may be considered to reduce tax on daily use items.

The GST reform will be taken during the meeting of this GST Council under the chairmanship of Union Finance Minister Nirmala Sitharaman. In the proposed reforms, the current 12% and 28% tax slabs are prominent to keep two tax rates of only 5% and 18%. Apart from this, a special rate of 40% will be done on a few selected items.

Why GST Council is important

The tax slab cut and the decrease in prices due to this has been commonly welcomed. But the states ruled by opposition parties are demanding compensation for the loss in revenue due to this change.

Prime Minister Narendra Modi in the Independence Day speech on 15 August told about the plan of GST reforms. Soon after, the Central Government shared a blueprint for the proposed improvement with a group of ministers (GOM) of various states for initial review.

GOM has agreed to the proposal of the center to reduce tax rates. The council will consider these recommendations on 3-4 September.

The news agency PTI quoted sources as saying that the Group of Ministers has supported the imposition of 18% GST on an electric vehicle priced up to Rs 40 lakh, while agreeing hard to the changes in the slabs. However, the central government wants to encourage electric vehicles and is supporting 5% rate for them.

What can be big changes

• Ghee, dry fruits, 20 liters of drinking water, salty, some shoes and costumes, medicines and medical equipment are likely to be reduced from 12% to 5% tax slab.

• Objects like pencils, bicycles, umbrellas and hair pin can also be brought into 5% slab.

• Taxes on electronic goods like TV, washing machine and refrigerator can be reduced from 28% to 18%.

• At present, the highest rate and compensation cess of 28% is applicable to vehicles. 18% rate will be applicable to early level cars. At the same time, a special rate of 40% will be applicable on SUVs and luxury cars.

• A special rate of 40% will also be applicable to the objects like tobacco, paan masala and cigarettes. Additional tax can also be levied on this category on this category.

Opposition states like West Bengal have demanded that any tax imposed above the rate of 40% be shared with the states. So that their revenue deficit can be compensated. Eight states ruled by opposition parties include Himachal Pradesh, Jharkhand, Karnataka, Kerala, Punjab, Tamil Nadu, Telangana and West Bengal.

GST collection: In the midst of the announcement of GST Reform, this is the news for India, which was eagerly waiting. Due to this, US President Donald Trump, who imposed 50 percent high tariff over India, is sure to get chilly. The gross GST collection increased by 6.5 percent to more than Rs 1.86 lakh crore due to high domestic revenue. This information was received from the official data released on Monday. The GDP and Services Tax (GST) collection was Rs 1.75 lakh crore in August 2024. The collection was Rs 1.96 lakh crore last month. In August this year, gross domestic revenue increased by 9.6 percent to Rs 1.37 lakh crore, while the import tax declined by 1.2 percent to Rs 49,354 crore. The GST refund declined by 20 percent to Rs 19,359 crore on an annual basis. Pure GST revenue stood at Rs 1.67 lakh crore in August 2025, which is a 10.7 percent increase on an annual basis.

These figures were released just two days before the meeting of the GST Council of the Center and the states. In this meeting, discussions will be made to rationalize the rates and reduce the number of tax slabs.

Big benefits of GST reform

The long -term success of the Goods and Services Tax (GST) depends on how it adopts a single nationwide tax rate and adopting two tax rates of five and 18 percent in the proposed GST reform can be a step taken in that direction. This assessment has been introduced in a report.

The report released on Monday by the idea group Think Change Forum says that even though the rate of 40 percent has been determined for luxury and harmful products in the proposed reforms, doing so will open the path of expansion of rates and affect the purpose of simplifying the tax system. According to the report, the maximum indirect tax rate should be limited to 18 percent including cess. By doing this, the discrepancy such as the fee structure will be removed, illegal markets will be curbed, the burden of controversy and compliance will be reduced and the credibility of the GST system will be restored.

The possibilities of a two-day tax system of five and 18 percent will be considered in the meeting of the GST Council headed by Union Finance Minister Nirmala Sitharaman on 3-four September. The council consists of Finance Minister of all states and union territories and representatives of the Central Government. In this meeting, recommendations made by groups of ministers (GOMs) will also be considered. These ministers are relating to genuine tax rates, compensation cess and discount on health and life insurance premiums.

The report also states that cutting tax rates is not a decrease in revenue collection, but a part of the growth strategy. This is possible to increase consumption, better compliance and long -term increase in revenue collection, which will strengthen India’s goal of becoming a developed economy. Recommending to ensure transparency in the context of cess and overloads on luxury and harmful products, the report proposes to create a cessmore manual, which will clarify the process of levying, adjusting or abolishing cess.

Learn from old mistakes in GST 2.0

The report says that alternative measures of indirect tax revenue, such as levying taxes at maximum retail price or giving insurance from GST without input tax credit, distort the original form of this tax system and puts hidden burden on consumers.

The General Secretary of the Think Change Forum Ranganath Tea released the report saying, “GST reforms should be implemented not only symbolic, but also in public interest. A solid initiative is necessary towards transparency and estimation.” The author of the report and Professor Nilanjan Banik at the University of Mahindra said, “The old mistakes should not be repeated in GST 2.0. Today, two rates and tomorrow are only one rate of real improvement. This will ensure better compliance, low deformity and permanent revenue growth.”

Also read: Taxparens pay attention! If your refund stops after ITR, then money will come only after e-verification, know where the lapse has happened