New Delhi: Despite the nation’s ongoing rate restructuring exercise, India’s Goods and Services Tax (GST) collections are expected to exceed budgetary expectations in FY26, according to SBI Research.
According to the banking group’s most recent analysis, GST revenue is anticipated to surpass the Union Budget’s projections for the current fiscal year. According to the report, this outlook is consistent with the growth projections made by the GST Council, indicating that indirect tax revenues will remain resilient despite the implementation of a new rate regime.
The rationalisation of GST slabs, which was started in September 2025, is a key contributor to this optimism. A zero per cent exempt category, two standard rates of 5 per cent and 18 per cent and a 40 per cent rate applied to luxury and sin goods are all part of the updated structure.
SBI Research predicts that the majority of states will gain from this reform, with Karnataka seeing an even greater increase of 10.7 per cent and Maharashtra seeing a 6 per cent revenue gain. According to the report, the states will continue to be net gainers after the rationalisation of the GST.
Noting that prior adjustments in July 2018 and October 2019 did not reduce overall revenue, the analysis also drew on prior experiences. After tax cuts, there may be an initial 3-4 per cent monthly decline, or roughly Rs 5,000 crore, but collections usually stabilise and increase by 5-6 per cent monthly after that, resulting in additional revenues of almost Rs 1 trillion.
This optimistic outlook is supported by recent data. Gross GST collections increased 4.6 per cent year over year to Rs 1.95 lakh crore in October 2025. Total inflows for FY26’s April–October period were Rs 13.89 lakh crore, up 9 per cent from Rs 12.74 lakh crore during the same time last year.