Mahakumbh ripple effect: GST, VAT collections, fuel sales soar in Uttar Pradesh

The Prayagraj Mahakumbh, the 45-day mega religious event that concluded on February 26, not only drew 66 crore (660 million) pilgrims but also generated a significant economic footprint across Uttar Pradesh.

The event led to a sharp rise in tax collections across the sectors as well in fuel sales, helping the Uttar Pradesh government earn an additional around ₹500 crore revenue as Goods and Services Tax (GST)/Value Added Tax (VAT).

According to official data accessed by the HT, the government collected ₹239.47 crore in taxes from just a few sectors related to the Mahakumbh in January and February 2025. Prayagraj alone accounted for ₹146.4 crore, the highest among all zones. Simultaneously, the Indian Oil Corporation reported an average 36.25% increase in petrol and diesel sales in the district during January and February — a direct outcome of the heightened mobility and logistics demand.

“The Mahakumbh has contributed around ₹500 crore additional GST/VAT to the state exchequer, showing the scale of activities during the event,” a senior state tax department official said.

The tax increase spans key sectors, including railways, air travel, hotels, tent houses, advertising and civic bodies. In Prayagraj, tax receipts stood at ₹76.75 crore in February (January revenue paid in February) and ₹65.81 crore in March (February tax paid in March) along with ₹2.15 crore collected as TDS (Tax Deducted at Source).

“Railways alone contributed ₹124.6 crore ( ₹68.79 crore in February and ₹55.81 crore in March), while tent houses and advertising generated ₹9.38 crore, and the hotel sector ₹7.12 crore. Contributions also came from departments such as PWD and Nagar Nigam,” the official said, citing the data.

Other districts played their part, too. Noida collected ₹12 crore, largely from hotels and online booking platforms, Varanasi ₹8.42 crore and Ayodhya ₹2.28 crore. Air travel-related tax collection across the state stood at ₹68.37 crore. Officials noted that ₹9.3 crore in TDS is still due from Prayagraj-based entities, expected to be cleared soon.

Kumbh-driven traffic

Indian Oil’s data submitted to the government shows petrol (MS) sales rose by an average of 60.72%, while diesel (HSD) sales increased by 23.24% during January and February 2025 in Prayagraj. The combined fuel sales in these two months rose by 11,809 KL, marking a 36.25% overall growth compared to the same period last year.

In January, petrol sales rose from 5,253 KL to 7,157 KL (up 1,904 KL, or 36.25%), and in February, from 6,058 KL to 11,022.50 KL (up 4,964.50 KL or 81.95%). Diesel sales registered a rise from 10,204 KL to 12,428 KL in January (up 2,224 KL, or 21.8%) and from 11,061 KL to 13,777.50 KL in February (up 2,716.50 KL, or 24.56%).

“To meet the surge in demand, Indian Oil operated 123 retail outlets (ROs) round-the-clock in and around Prayagraj and along key routes leading to the Kumbh venue. These outlets reported a growth of 59.4% in petrol sales and 14.8% in diesel sales during the Kumbh period,” a senior IOC official disclosed.

“All 123 ROs offered essential amenities such as free drinking water, air, first-aid kits, and clean washrooms to support the massive inflow of pilgrims and vehicles,” he added.

Officials said the combined rise in tax revenue and fuel consumption underlines the Mahakumbh’s vast economic ripple effect — boosting travel, hospitality, and public services while highlighting massive investment by the government in the infrastructure for such mega-events.

Source: Hindustan Times