Monthly GST mop-up could be Rs 4-5 lakh crore if loopholes plugged: SBI economist

GST collections have averaged Rs 1.98 lakh crore in the first seven months of FY26, having crossed the Rs 2 lakh crore-mark in April and May.

Soumya Kanti Ghosh, State Bank of India's (SBI) Group Chief Economic Advisor. (Source: FB)

The Indian government’s gross Goods and Services Tax (GST) collections could average Rs 4 lakh crore to Rs 5 lakh crore every month in the future if loopholes in the indirect tax system are closed, Soumya Kanti Ghosh, State Bank of India’s (SBI) Group Chief Economic Advisor and member of the 16th Finance Commission, said on Thursday. Speaking at the Delhi School of Economics’ Public Policy Conference, Ghosh said his conversations with the government suggested the monthly mop-up could more than double from current levels.

“In terms of GST collections, the government has been making earnest efforts to plug the loopholes… GST collections in FY21 was Rs 11 lakh crore. In FY26, the budgeted number is around Rs 25 trillion. And the average monthly gross GST collection has moved from less than Rs 1 lakh crore to more than Rs 2 lakh crore over a period of five years. That has been a remarkable achievement,” Ghosh said.

“I understand, when I speak to the government, that the potential could be significantly higher; it could be in fact higher than Rs 4 lakh crore or even Rs 5 lakh crore if you are able to plug all the loopholes,” he further said.

As per data released earlier this month, the government’s gross GST collections in October stood at Rs 1.96 lakh crore, up 4.6 per cent year-on-year. This was after the sweeping GST cuts that came into effect from September 22. So far in the first seven months of the current fiscal, gross GST collections have totalled Rs 13.89 lakh crore — up 9 per cent from the first seven months of FY25 — with the monthly average at Rs 1.98 lakh crore. However, monthly collections have crossed the Rs 2 lakh crore-mark on two occasions in the current fiscal: first when they came in at a record Rs 2.37 lakh crore in April and then Rs 2.01 lakh crore in May.

In a report on Tuesday, Ghosh wrote an SBI Research analysis indicated that GST collections in November could cross Rs 2 lakh crore, driven by festive season demand on the back of lower GST rates and increased compliance. GST data for November will be released on December 1.

“The Rs 2 lakh crore (average GST collections per month) is actually an underestimate. This number could go up further if the Centre is able to plug the loopholes in conjunction with the states,” Ghosh said on Thursday, adding that “better the indirect tax structure, the better it will be able to subsidise direct taxes”.

As per the Union Budget for FY26, the Centre’s gross tax revenue is seen at Rs 42.7 lakh crore this year, up 10.8 per cent from the revised estimate for FY25. Meanwhile, the Central GST mop-up is seen 11.3 per cent higher year-on-year at Rs 10.11 lakh crore.

Siddharth Upasani

Siddharth Upasani is a Deputy Associate Editor with The Indian Express. He reports primarily on data and the economy, looking for trends and changes in the former which paint a picture of the latter. Before The Indian Express, he worked at Moneycontrol and financial newswire Informist (previously called Cogencis). Outside of work, sports, fantasy football, and graphic novels keep him busy. ... Read More