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Growth in Gross Goods and Services Tax (GST) revenues slowed to 8.5% in November from 8.9% in October, with the indirect tax receipts easing to a little over ₹1.82 lakh crore from ₹1.87 lakh crore in the previous month.

However, net GST revenues, after factoring in refunds to taxpayers, increased at a faster pace of 11.1% to hit ₹1,63,010 crore, with domestic transactions yielding 12.5% higher taxes than a year ago, while revenues from imports were up 5.6%. Net revenues had risen 7.9% in October to a tad above ₹1.68 lakh crore.

Prior to refunds, collections from domestic transactions were 9.4% higher and those from imports were up 5.9%. Much of the gap between the slower growth in gross receipts and the higher uptick in net revenues can be attributed to a sharp 19.6% fall in refunds for domestic transactions which stood at just ₹10,111 crore in November. Refunds related to exports grew 6.8%.

In October, refunds to domestic taxpayers had risen 42.8%, while export-related refunds had contracted 2%. In July this year, GST refunds had also contracted by over 19%.

Overall, the first eight months of the financial year have now recorded a 9.2% growth in net GST revenues that stand at almost ₹12.91 lakh crore. While this marks a marginal improvement over the cumulative pace of 9% till October, it is still markedly slower than the growth of about 11% penned in to the Centre’s Budget 2024-25 arithmetic.

It must be reiterated that November’s tax receipts typically pertain to transactions undertaken in October.

Noting that month-on-month GST collections have declined, despite the festive season boost, EY India tax partner Saurabh Agarwal said he expects tax receipts to slow down in the next four months of the year. “The global geopolitical scenario and potential consumer spending cuts could further exacerbate short-term economic growth,” he reckoned.