6 days ago
India’s Direct Tax Collections Rise 13% as Corporate Payments Surge
India collected more direct taxes this year than during the same period last year.
After refunds were paid, collections reached about Rs 12.12 lakh crore by September 17.
Companies paid about 18% more advance tax, helping drive the increase.
Advance tax from individuals and other non-corporate taxpayers also rose, but more slowly.
The government collected Rs 14.32 lakh crore before refunds.
Refunds increased by nearly 29%.
Taxes from securities transactions rose sharply, partly because the tax on futures transactions was increased.
Experts said the figures suggest continued business and market activity.
They also cautioned that tax collections alone do not directly measure economic growth.
Net direct tax collections rose 12.96% year-on-year to over Rs 12.12 lakh crore by September 17.
Advance tax collections increased 16.18% to Rs 5.22 lakh crore, including an 18% rise in corporate payments to over Rs 4.16 lakh crore.
Gross direct tax collections reached Rs 14.32 lakh crore, while refunds increased 29.19% to over Rs 2.20 lakh crore.
Corporate tax collections after refunds rose 19.48% to Rs 5.56 lakh crore, compared with 6% growth in non-corporate tax collections.
Securities Transactions Tax collections surged 53% to Rs 40,214 crore, partly reflecting market activity and a higher futures tax rate.
- Who
- The Government of India, companies, individual taxpayers, and other taxpayers.
- What
- Net direct tax collections rose 12.96% after refunds, driven especially by corporate advance-tax payments and higher securities transaction tax receipts.
- Where
- India.
- When
- By September 17 in fiscal year 2026-27.
- Why
- The increase was attributed to stronger corporate payments, enhanced compliance, continued business and market activity, and a higher tax rate on futures transactions.
Positive interpretation
Cautious interpretation
Meeting the budget target
Positive interpretation
Experts said the collection pace remains above the 11.4% growth projected in the Budget and puts the government on track to meet or exceed its FY27 direct-tax target.
Cautious interpretation
The growth rate slowed from more than 23% through August 10, so the full-year outcome still depends on collections later in the fiscal year.
Economic activity
Positive interpretation
Experts said rising corporate and advance-tax payments indicate taxpayer confidence, business performance, and continued income and economic activity.
Cautious interpretation
Other experts cautioned that tax collections alone cannot be treated as a direct measure of economic growth.
Breadth of revenue growth
Positive interpretation
Growth in net direct taxes, advance tax, corporate tax, and Securities Transactions Tax was described as evidence of broad-based tax buoyancy.
Cautious interpretation
Non-corporate tax collections after refunds rose only 6%, considerably more slowly than corporate tax collections.
Key facts
- Net direct taxes
- Over Rs 12.12 lakh crore after refunds, up 12.96% year-on-year.
- Gross direct taxes
- Over Rs 14.32 lakh crore before refunds, up about 15% year-on-year.
- Advance taxes
- Rs 5.22 lakh crore, up 16.18% year-on-year.
- Corporate advance tax
- Over Rs 4.16 lakh crore, up 18% year-on-year.
- Corporate tax after refunds
- About Rs 5.56 lakh crore, up 19.48% year-on-year.
- Securities Transactions Tax
- Rs 40,214 crore, up 53% year-on-year.
- FY27 direct-tax target
- Rs 26.97 lakh crore; collections so far represent 44.9% of the target.
Quotes
Amit Maheshwari
Managing partner at AKM Global
“Net (post-refunds) direct-tax collections are showing both strength and resilience, driven by stronger gross tax inflows, enhanced compliance, and sustained economic and market activity. The most encouraging signal is that net collections have continued to rise despite a substantial increase in refunds.”
financialexpress.com
“Nominal GDP for June quarter of FY27 grew 10.3 per cent, and the FY27 Budget assumes full-year nominal growth of 10 per cent. Against that baseline, gross direct tax buoyancy runs at roughly 1.47, and net buoyancy at 1.26, a meaningful reversal from FY 2025-26”
deccanchronicle.com
Sources
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