India's Goods and Services Tax (GST) implementation has significantly improved tax revenue buoyancy for state governments, with Maharashtra emerging as the primary beneficiary, according to a new report by India Ratings.
The credit research firm identified Maharashtra as the state with the highest share of tax buoyancy post-GST, attributing the performance to robust domestic consumption and a substantial services sector.
The analysis highlights how the unified tax regime has allowed states with strong economic fundamentals to capture greater revenue growth relative to GDP expansion.
Beyond Maharashtra, the report lists Manipur, Nagaland, Goa, and Sikkim among the top five states with the highest tax buoyancy figures.
This distribution underscores the varying impact of the tax reform across India's diverse regional economies, with smaller states and those with specific consumption patterns also seeing notable improvements in revenue elasticity.
The findings arrive as Indian equity markets close the week on a positive note, with the Nifty 50 rising 0.90% to 24,270.80 and the Sensex gaining 0.86% to 77,763.91.