India’s Net GST Collection Rises 10.7% In Q1 FY26, Aided By SME Reforms; Details Here

Minister of State for Finance Pankaj Chaudhary shared the update in a written response to a question in the Rajya Sabha on Tuesday

Service providers making intra- or inter-state taxable supplies are exempt if their turnover does not exceed Rs 20 lakh annually, or Rs 10 lakh in specific states.

Source : ABPLIVE AI

India's net Goods and Services Tax (GST) collections have seen a significant uptick in the first quarter of the current financial year, reflecting improved economic activity and compliance. The average monthly net GST revenue stood at Rs 1,80,774 crore during the April-June period of FY 2025-26, marking a 10.7 per cent increase compared to Rs 1,63,319 crore recorded in the same quarter last year.

Minister of State for Finance Pankaj Chaudhary shared the update in a written response to a question in the Rajya Sabha on Tuesday.

GST Relief For Small Enterprises

The Minister outlined several pro-business initiatives adopted on the recommendations of the GST Council, particularly aimed at easing the compliance burden for micro, small, and medium enterprises (MSMEs).

As part of these reforms, businesses engaged in intra-state taxable supply of goods with an annual turnover below Rs 40 lakh are exempt from GST registration requirements. This threshold stands at Rs 20 lakh for certain special category states.

Similarly, service providers making intra- or inter-state taxable supplies are exempt if their turnover does not exceed Rs 20 lakh annually, or Rs 10 lakh in specific states.

Simplified Tax Filing Options

To further streamline the process for smaller businesses, the government has introduced the composition levy scheme. This optional method allows eligible taxpayers with turnover up to the prescribed limit to pay GST at a flat rate—1 per cent for goods traders and manufacturers (split equally between CGST and SGST), and 5 per cent for restaurants (2.5 per cent under each Act).

Eligible businesses with an annual turnover of up to Rs 5 crore can also opt for quarterly return filing while continuing to make monthly tax payments.

Measures To Control Inflation

In addition to tax policy reforms, Chaudhary noted that the government has undertaken various administrative actions to manage inflationary pressures. These include maintaining buffer stocks of essential commodities and strategic grain releases to stabilize market prices.

Further actions include import facilitation, export restrictions during shortages, and stockholding limits to improve domestic supply availability.