New Delhi, Feb 2 (PTI) The government has projected a modest 5 per cent growth in customs revenue for FY2026-27 after taking into account the impact of free trade pacts, duty exemptions on capital goods imports and tapering of edible oil imports, a top official said on Monday.

Goods and Services Tax (GST) revenues in FY27 are projected to grow at 6.3 per cent, with a buoyancy of 0.94 even after a reduction in tax rates on about 375 items with effect from September 22, 2025, Central Board of Indirect Taxes and Customs (CBIC) Chairman Vivek Chaturvedi said in a post-Budget interview to PTI.

The FY'27 tax revenue targets are realistic and achievable, the CBIC chief added.

The Budget has projected a 5 per cent growth in Customs revenue at Rs 2.71 lakh crore in FY'27. In GST, the collection is estimated at Rs 10.19 lakh crore, which would be a 6.3 per cent growth YoY after excluding the compensation cess which ended in January.

Chaturvedi said modest growth projections in Customs are based on the assumption that there would be more free trade agreements (FTA), which would mean that there would be a preference for the MFN rate over tariff rates. This could result in a downside for the revenues.

Also, customs duty exemption on import of capital goods announced in FY'27 Budget for domestic manufacturing and schemes like PLI, could dent collections. Also, tapering of edible oil imports, which had surged in the first half of the current fiscal, would lower revenue mop-up.

"These are the reasons we have been very conservative in growth projections over RE of FY'26," Chaturvedi said. PTI JD RR CS JD MR

Customs and GST revenues projected modest growth for FY2026-27 amid FTAs, exemptions and rate cuts, per CBIC. The government projects 5% Customs growth to Rs 2.71 lakh crore and 6.3% GST growth to Rs 10.19 lakh crore for FY2026-27, with GST buoyancy at 0.94 despite rate cuts on about 375 items and end of the compensation cess. The CBIC cites expanded FTAs, customs duty exemptions for capital goods and PLI-linked manufacturing, and tapering edible oil imports as reasons for conservative Customs projections.