Central and state governments collected a record ₹2.43 trillion in Goods and Services Tax (GST) revenue in the first month of the financial year, data from the finance ministry showed.
In April last year, Centre and states had collected ₹2.37 trillion in GST revenue before adjusting for refunds. The higher gross revenue collection in April this year is in spite of the sharp tax cuts cut in September 2025 as part of efforts to stimulate demand. After adjusting for refunds, GST revenue in April stood at ₹2.11 trillion. In April last year, net GST revenue receipts of Centre and states was ₹2.09 trillion. That included GST compensation cess, which has since been phased out. If that is excluded, last year’s gross collection stands at ₹2.23 trillion, indicating 8.7% annual growth in gross collections this April.
GST collections typically peak in the first month of the financial year, as April’s revenue reflects the surge in factory inventory clearances that occur every March to close the books. For FY27, the central government alone has a GST revenue target of ₹10.2 trillion, a notch below the ₹10.46 trillion it’s estimated to have collected in FY26.
While April GST collections are always high, their consistent record of outperforming every other month year after year is what truly stands out, said Ikesh Nagpal, lead – indirect tax, at tax and consulting firm AKM Global.
Higher year-end sales in March, inventory clearances, and book closures naturally flow into April GST revenue collections, making it the strongest month across most fiscal cycles, he added. “This makes the April spike a consistent seasonal feature rather than a one-off surge,” Nagpal said.
Energy shock
Budget projections for FY27 were made on 1 February, before the West Asia war began on 28 February. It therefore remains to be seen how consumption of goods and services is affected by the rise in global energy prices. GST is a tax on consumption.
In April the government slashed excise duty on petrol and diesel and imposed a windfall tax on the export of diesel and jet fuel to protect the balance sheets of oil marketing companies from the global energy shock without causing retail prices of petrol and diesel to increase.
However, the government may at some point be forced to pass rising energy costs on to consumers, as repairing the oil supply chains damaged by the West Asia war could take time.
The finance ministry said in its monthly economic review for April released this week that passing on higher energy costs to the final consumer may be inevitable. Some countries have begun to allow prices to be passed on to end-users—households and businesses—but some are yet to do so, it said.