Punjab Tops States in SGST Cash Growth Even as GST 2.0 Pressures Persist

Despite revenue pressures caused by the Centre's GST 2.0 rate rationalisation, Punjab has recorded a strong rise in GST collections in January 2026, signalling improved compliance, focused enforcement and sustained economic activity in the state.

Sharing the details, Punjab Finance, Excise and Taxation Minister Harpal Singh Cheema said the state collected ₹2,452.66 crore in GST in January 2026. In terms of net GST revenue, Punjab registered a year-on-year growth of 15.7 per cent, translating into an increase of ₹315 crore compared to January 2025.

Cheema said the achievement is significant as GST 2.0 rate cuts have resulted in an estimated monthly revenue loss of around ₹250 crore for Punjab. Sectors such as yarn, textiles, hosiery, pharmaceuticals, insurance, tyres and cement were among those impacted. Despite these setbacks, the state not only offset the revenue loss but also posted growth higher than national trends through sustained administrative reforms and targeted enforcement.

On a year-on-year basis up to January 2026, net GST collections rose by 13.4 per cent, increasing from ₹19,415 crore to ₹22,014 crore. Gross GST collections also grew by 13.0 per cent, reflecting the resilience and expansion of Punjab's tax base.

The minister highlighted that SGST cash collections in January 2026 rose by an exceptional 14.4 per cent, the highest growth rate among all Indian states for the month. This sharply outperformed the national average of around 6 per cent, placing Punjab at the top in SGST cash growth.

Cheema added that taxpayer facilitation remains a priority for the state government. In January alone, ₹129 crore worth of SGST refunds were issued, while total GST refunds during the month stood at around ₹300 crore. Timely refunds alongside robust revenue mobilisation, he said, reflect a mature, transparent and taxpayer-friendly tax administration.

Enforcement actions have also yielded strong results. The State Intelligence and Preventive Units (SIPU) crossed the ₹200 crore mark in recoveries in January 2026 through road checks, inspections and verification drives aimed at curbing ITC fraud and fake invoicing. Total enforcement-related recoveries in the current financial year are close to ₹1,000 crore, the highest ever, underscoring intensified, data-driven action against tax evasion.

The minister noted that, apart from GST 2.0 challenges, Punjab has faced additional fiscal pressure due to a unilateral deduction of around ₹280 crore from IGST settlements by the Centre over the past three months. Despite this, the state has maintained strong growth momentum, reflecting effective GST management and a robust compliance ecosystem.

Cheema said Punjab has successfully safeguarded its revenue base despite rate rationalisation, sector-specific slowdowns and IGST settlement cuts, achieving growth well above the national average. He emphasised that improved analytics, targeted enforcement, voluntary compliance and efficient administration can effectively overcome structural and policy-driven revenue challenges.

Reaffirming the government's commitment, the minister said the tax department remains focused on a fair, transparent and technology-driven tax administration, ensuring ease of doing business, timely refunds for compliant taxpayers, and protection of the state's revenue interests.