India’s Goods and Services Tax (GST) revenues softened in November as the government’s ongoing rate rationalisation process fully came into play. According to official data, GST mop-up moderated due to the restructured tax slabs and the phasing out of certain exemptions, which temporarily reduced the overall tax flow.

Officials noted that the recalibration of rates designed to simplify the indirect tax system has had a visible impact on collections this month. However, they emphasised that this dip was anticipated given the transitional adjustments businesses are making under the revised structure.

Despite the moderation, the finance ministry remains confident that revenue buoyancy will return as consumption strengthens in upcoming months. A pickup in festival-season spending, along with higher compliance levels and better analytics-driven monitoring, is expected to compensate for the short-term shortfall in GST receipts.

Economists also believe that as the revised slabs stabilise, collections should find a firmer footing. They point out that the reform is part of a longer-term strategy aimed at improving efficiency and reducing classification disputes within the GST framework.

The government, meanwhile, continues to evaluate sectoral trends and compliance behaviour to assess the deeper impact of rate adjustments and to ensure revenue neutrality is maintained over the fiscal year.