GST collections jump 22.9% to Rs 2.31 lakh crore in October as festive demand beats high inflation and interest rates

India's gross goods and services tax (GST) collections rose 22.9% year-on-year in October, reaching ₹2.31 lakh crore, according to new data. The surge in collections indicates robust festive-season consumption, despite the country grappling with rising inflation, increased interest rates, and an unfavorable global environment. Other high-frequency data further supports India's strong consumption narrative.

Passenger car sales increased by 14% to over 525,000 units, a record high. Digital payments hit a record 25.47 billion in October, a 23% rise, while transaction value grew 16% to ₹31.53 lakh crore. Power consumption surged nearly 22% in October, reaching 160 billion units, while diesel sales rose 11.7% on-year. While petrol sales grew moderately by 3.1%, jet fuel and LPG sales declined.

Net GST collections, after accounting for refunds, climbed 25.6% to ₹2.03 lakh crore in October, with total refunds increasing by 6.5%. The robust performance is expected to continue, reflecting a domestic consumption-driven economy that is growing steadily, as indicated by various macroeconomic indicators. MS Mani, a partner at Deloitte India, noted that strong growth in GST collections underscores the need to promote domestic manufacturing capabilities and support India's Atmanirbhar Bharat initiative.