India’s tax collections showed steady growth in the current financial year as net direct tax receipts increased to ₹18.38 lakh crore. The rise reflects improved compliance, stable corporate performance and sustained individual income growth. According to official data, both corporate and non-corporate taxes contributed to this increase, while lower refunds further supported higher net collections, highlighting resilience in the Indian economy.
Why in News?
India’s net direct tax collections grew by 8.82% in the current financial year so far. The data released by the Income Tax Department highlights strong tax performance and improved fiscal position.
Overall Direct Tax Collections In FY 2025-26
- Net direct tax collections reached ₹18.38 lakh crore in the ongoing financial year up to January 11.
- This represents a significant increase compared to the previous year, supported by consistent economic activity and better enforcement measures.
- Gross direct tax collections also rose by 4.14% to about ₹21.50 lakh crore, showing broad-based growth before refunds.
- The steady rise in collections indicates improved income reporting, expansion in the formal economy and stable corporate earnings.
- These trends strengthen government finances and provide room for higher public spending and fiscal stability.
Category Wise Breakdown
Corporate and Non-Corporate Tax Performance
- Corporate tax receipts remained a key contributor, with net corporate taxes amounting to ₹8.63 lakh crore during the period.
- At the same time, non-corporate taxes, including payments from individuals, professionals and Hindu Undivided Families (HUFs), stood at ₹9.30 lakh crore.
- The strong performance of non-corporate taxes reflects rising personal incomes, increased employment and better tax compliance among individuals.
- Together, these figures indicate balanced growth across different segments of taxpayers and sustained momentum in economic activities.
Collection of Securities Transaction Tax (STT)
- Collections from the Securities Transaction Tax (STT) amounted to ₹44,867 crore between April 1 and January 11.
- This reflects steady participation and activity in India’s capital markets, including equities and derivatives trading.
- Consistent STT collections indicate investor confidence and stable market conditions despite global uncertainties.
- The government has also set a higher STT target for the next financial year, underlining expectations of continued growth in market-based transactions and financial sector activity.
Impact of Lower Tax Refunds
- One of the major reasons for higher net collections was a decline in tax refunds. During the same period, refunds fell by 17% year-on-year to ₹3.12 lakh crore.
- Lower refunds directly increase net tax receipts, strengthening the government’s cash position.
- This trend suggests better advance tax estimation and smoother assessment processes.
- It also reflects improvements in tax administration, reducing the need for large post-assessment refunds while maintaining taxpayer confidence.
Future Targets and Projections
For the 2025-26 financial year, the government has projected direct tax collections of ₹25.20 lakh crore, representing a 12.7% increase over the previous year. Additionally, the STT target has been set at ₹78,000 crore for FY26.
- These ambitious targets signal confidence in sustained economic growth, expanding tax base and improved compliance.
- Achieving these goals will be crucial for funding development programmes, infrastructure projects and social welfare initiatives.
Key Summary at a Glance
| Aspect | Details |
| Why in News? | Net direct tax collections rose 8.82% |
| Net Collections | ₹18.38 lakh crore |
| Corporate Tax | ₹8.63 lakh crore |
| Non-Corporate Tax | ₹9.30 lakh crore |
| STT Collection | ₹44,867 crore |
| FY26 Target | ₹25.20 lakh crore |
Question
Q. India’s net direct tax collections in the current fiscal stood at:
A. ₹15.20 lakh crore
B. ₹16.80 lakh crore
C. ₹18.38 lakh crore
D. ₹21.50 lakh crore