VIJAYAWADA: Andhra Pradesh has demonstrated remarkable resilience and efficiency in tax collection, successfully reversing the downward trend observed in November and December 2024.
Through strategic policy implementation and improved compliance measures, the state achieved sustained growth in GST revenue during the first quarter of 2025, with March emerging as an exceptional month for revenue collection.
In March 2025, net GST collections reached Rs 3,116 crores, marking the highest amount collected in the past 11 months and the second highest this year. “This impressive performance not only signifies effective tax administration but also reflects the positive economic momentum in the state.
The steady increase in tax revenue underscores the strength of the state’s financial framework and the success of various initiatives designed to enhance tax compliance and enforcement,” said AP chief commissioner of taxes.
He explained that the net GST collections in March 2025 represent the highest revenue for March since the introduction of the Andhra Pradesh Goods and Services Tax (APGST) Act in 2017.
He said that March 2025 stands as the third-highest revenue-generating month in any financial year since the inception of the APGST regime, further emphasizing the remarkable nature of this achievement. “Net GST collections have shown an impressive surge of 8.35% in March 2025 compared to March 2024. This remarkable increase reflects strengthened tax compliance, improved settlement adjustments, and a broader tax base within the state.
The cumulative net revenue collections for the financial year have increased by 5.09%, further emphasizing the state’s strong fiscal position and sustainable revenue inflows,” said Babu.
This growth in net collections is particularly significant because net revenue represents the actual revenue accrued to the state after accounting for IGST settlements and other components. While gross collections reflect the total tax paid, net collections provide a more accurate indicator of the state’s fiscal health by considering the actual revenues available for state expenditures.
The cumulative growth figures from April 2024 to March 2025 further highlight this trend, with net collections increasing by 5.09% compared to the same period in the previous financial year, totalling Rs 33,660 crores against Rs 32,030 crores.
GST gross collections for the year:
In FY 2024-2025, GST gross collections increased by 1.19%, amounting to Rs 44,825 crores compared to Rs 44,298 crores in 2023-24. “The collection of Integrated Goods and Services Tax (IGST) has an indirect impact on the net revenues of the state.
Under the IGST mechanism defined in the GST Act, the IGST paid by taxpayers within the state is transferred to other states, which affects the state’s overall revenue share if taxpayers adjust the SGST credit against the IGST liability,” said Babu.
IGST collections indirectly affect the net revenues of the state, as the IGST paid by the taxpayers of the state will be settled to other states according to the IGST mechanism under the GST Act . The primary reasons for the low growth in GST gross collections arise from the state’s GDP predominantly depending on the primary sector, which is largely exempt from GST tax.
Despite the challenges posed by a decline in petroleum product revenues—due to a decrease in the basic price set by the Government of India and policy changes—overall tax collections have continued on a positive trajectory. Additionally, the reduction in the retail price of liquor, which typically contributes significantly to state revenue, had an impact as well.
Several key measures have contributed to this impressive growth, including enhanced return compliance, strengthened enforcement strategies, and the integration of interdepartmental data. Initiatives such as real-time monitoring of collections, round-the-clock vehicle checks to prevent tax evasion, and automation of tax scrutiny have significantly improved efficiency and accountability in tax administration.
As the state continues to implement progressive tax policies and adopt digital innovations for compliance monitoring, the overall outlook for GST collections remains quite promising. With ongoing efforts to strengthen enforcement mechanisms and broaden the tax base, the state is poised for sustained revenue growth, enhancing its fiscal stability and economic development.
The government is dedicated to enhancing taxpayer services, making compliance straightforward, and fostering a tax-friendly atmosphere that supports business growth while effectively contributing to the state’s revenue increase.
