India’s net direct tax collections rose nearly 9 per cent year-on-year to ₹18.38 trillion as of January 11 in the current fiscal, reflecting steady revenue momentum despite moderation in refunds, according to data released by the Income Tax Department on Monday.
Net direct tax receipts stood at ₹18.38 trillion, registering a growth of 8.82 per cent over the corresponding period last year. The collections include net corporate tax of over ₹8.63 trillion, while taxes from non-corporates including individuals, Hindu Undivided Families (HUFs) and other entities amounted to ₹9.30 trillion, highlighting sustained buoyancy in personal income tax inflows.
Gross direct tax collections during the April 1 to January 11 period rose 4.14 per cent year-on-year to around ₹21.50 trillion. The difference between gross and net collections was primarily on account of refunds issued during the period.
Refunds declined sharply by 17 per cent to ₹3.12 trillion, compared to the year ago period. The moderation in refunds has significantly supported net tax collections and improved overall cash flows for the exchequer during the fiscal year.
Securities Transaction Tax (STT) collections stood at ₹44,867 crore during the same period, benefiting from sustained activity in the equity markets, although volatility has increased in recent months due to global uncertainties and changing interest rate expectations.
The steady growth in direct tax collections comes at a time when the government has set an ambitious target for the current fiscal year (FY26). In the Union Budget, the Centre projected direct tax collections of ₹25.20 trillion for FY26, representing a year-on-year growth of 12.7 per cent. Achieving this target will depend on continued momentum in corporate profitability, stable employment trends, and sustained income growth among individuals.
The government has also set a Securities Transaction Tax collection target of ₹78,000 crore for FY26, underscoring expectations of continued depth and participation in India’s capital markets.
Tax officials have attributed the improvement in collections to better compliance, wider use of data analytics, and the impact of policy measures aimed at formalisation of the economy. The expanding tax base, driven by higher reporting, digitisation and simplification of processes, has also played a key role in supporting revenue growth.
With over two months left in the fiscal year, direct tax collections are expected to gather further pace, supported by advance tax payments in the final quarter. The trend so far suggests that the government remains on track to meet, and potentially exceed, its budgeted direct tax targets, providing fiscal headroom amid ongoing infrastructure spending and welfare commitments.
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