An 11% GST growth number and a claim of "pathetic" 1.3% growth — both about the exact same five months of collections. The gap comes down to one item: the compensation cess, and whether it belongs in the comparison at all.
Govt Defends GST Data Against Manipulation Claims — What the Dispute Is Actually About
The Central Board of Indirect Taxes and Customs (CBIC) has publicly pushed back against claims that the government is manipulating GST collection data to make FY27 growth look stronger than it actually is. The allegation came from former finance secretary Subhash Chandra Garg, and the CBIC's rebuttal — posted on X — lays out a fairly specific technical argument about what should and shouldn't be counted when computing a year-on-year growth rate.
The Headline Numbers
The officially reported figures showed gross GST collections rising 14.8% year-on-year to ₹2 lakh crore in August, with April-August collections up 11% at ₹10.4 lakh crore. On a post-refund basis, GST revenue rose 8.3% year-on-year to ₹1.68 lakh crore in August, and was up 9% for the five months to August at ₹8.89 lakh crore.
Garg's Claim: Cess Is Being Left Out
In an article published a day before the CBIC's response, Garg argued that the government's 11% growth figure for April-August was misleading because it excluded cess collections from the comparison. His contention was that when cess is included in the calculation, the picture changes dramatically: five-month gross GST growth drops to 4.08%, and net growth (post-refund) falls to just 1.30% — which he characterised as "a pathetic performance." He went further, saying there is "an unfortunate but increasing tendency to manipulate data to suit narratives."
| Metric (Apr-Aug, YoY) | CBIC's Figure | Garg's Figure (cess included) |
|---|---|---|
| Gross GST growth | 11% | 4.08% |
| Net GST growth (post-refund) | 9% | 1.30% |
CBIC's Defence: The Cess Doesn't Exist Anymore
The CBIC's response rests on a simple underlying fact: the compensation cess that Garg wants included in the comparison has, for most goods, been legally discontinued. The GST Council discontinued the compensation cess from 22 September 2025 on all items except tobacco and related products. The cess on tobacco products was subsequently removed as well, effective 1 February 2026. From those dates onward, there is simply no cess being collected — not a small amount, but zero.
The CBIC also pointed out that this isn't a new or hidden change in methodology: since November 2025, publicly published GST revenue figures have shown compensation cess separately in a table below the headline numbers, with year-on-year growth computed on the tax base of CGST, SGST, and IGST for the corresponding periods. In other words, the calculation basis has been transparent and consistent for months — it isn't something invented for this particular comparison.
The CBIC's core argument, in its own words: "Where a levy has ceased to exist in law, retaining it in the base measures something else altogether. It is neither arithmetically right nor makes any logical sense." And separately: "A growth rate is meaningful only when it is computed on a comparable basis, that is, on the same set of levies on both sides of the comparison. Otherwise, it is like comparing apples and oranges."
Why This Is a Genuine Methodological Question, Not Just Semantics
Strip away the political framing, and there's a real statistical question underneath this dispute: when a component of a tax base is abolished partway through the comparison period, how should a year-on-year growth rate treat it?
The CBIC's position is that the correct approach is to compare like with like — CGST, SGST, and IGST collections in the current period against the same three components in the base period, since the cess simply isn't part of the current levy structure anymore. Under this method, the "growth" being measured is the growth of the tax base that actually still exists.
Garg's implicit position is closer to a like-for-like comparison against the full basket of levies that existed in the base period — including cess, even though it no longer exists in the current period. Under this method, the discontinued cess collections from the earlier year effectively count as revenue "lost" this year, dragging the growth number down sharply, even though that revenue was never expected to recur once the cess was abolished by Council decision.
Both approaches produce mathematically defensible numbers, which is exactly why this kind of dispute persists — the disagreement isn't over the arithmetic, it's over which base is the meaningful one to compare against once a levy has been legally discontinued.
CBIC's Closing Position
The CBIC characterised any attempt to cherry-pick figures computed on two different tax bases as "thoroughly misleading and mischievous," and argued that "a fair analysis must compare like with like, instead of misleading our citizens by comparing two fundamentally different datasets." Its broader point is that a growth figure exists to show how the underlying, currently applicable tax base has moved — and a base that includes a tax no longer levied doesn't serve that purpose.
The takeaway: the dispute isn't about whether the raw collection numbers are accurate — both sides appear to agree on those. It's about whether a discontinued compensation cess should be included in the base period of a year-on-year comparison once it no longer exists in the current period, and reasonable people can read that methodological choice differently.
This post summarizes public statements by the CBIC and former finance secretary Subhash Chandra Garg regarding FY27 GST collection data, as reported as of September 2026. It is a general informational overview, not an independent verification of either party's figures.