Net Direct Tax Collections Increase by Nearly 15% Overview

Net direct tax collections in India surged by 14.64% to over Rs 5.21 lakh crore as of June 17 in the current financial year. This increase is attributed to strong advance tax payments from companies and a significant rise in securities transaction tax (STT) collections, according to government data released on Thursday. The growth positions the Centre to meet its ambitious direct tax target for FY27, reflecting ongoing strength in corporate profitability and market activity.

Corporate and Non-Corporate Tax Collections

Net corporate tax collections rose by 22% to Rs 2.08 lakh crore during the same period. In contrast, net non-corporate tax (NCT) collections, which encompass taxes paid by individuals, Hindu Undivided Families (HUFs), and firms, increased by 8% to approximately Rs 2.94 lakh crore. Collections from STT saw a remarkable jump of 45%, reaching Rs 18,856 crore.

Advance tax collections, a key indicator of business performance, grew by 15.30% to more than Rs 1.78 lakh crore. Corporate advance tax payments rose by 16% to over Rs 1.40 lakh crore, while advance tax collections from non-corporate taxpayers increased by 13% to Rs 37,620 crore. Refunds issued until June 17 amounted to Rs 89,026 crore, reflecting a 1.19% increase from the previous year.

Gross Direct Tax Collections

On a gross basis, direct tax collections increased by 12.46% to over Rs 6.10 lakh crore. Gross corporate tax collections exceeded Rs 2.76 lakh crore, while non-corporate tax collections were around Rs 3.15 lakh crore. The government has set a target of Rs 26.97 lakh crore for direct tax collections in FY27, aiming for a 15% growth over the Rs 23.40 lakh crore collected in FY26.

Experts have noted the positive trends in tax collections. Deloitte India Partner Rohinton Sidhwa remarked that tax collections appear to have rebounded from previous years’ rate cuts, indicating a return to growth. EY India Tax Partner Jayesh Sanghvi highlighted that the advance tax growth signals a reversal from last year’s sluggish growth, suggesting increased business confidence.

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