Net Direct Tax Revenue Up 9.18% to ₹10.82 Lakh Crore as Refunds Drop Sharply

India's net direct tax revenue has seen a notable 9.18% rise year-on-year, reaching ₹10.82 lakh crore for the current financial year as of September 17, 2025. This gain comes primarily due to a significant reduction in refunds disbursed by the tax department.

Direct Tax Revenue Witnesses Strong Growth With Reduced Refunds

Between April 1, 2025 and September 17, 2025, India's net direct tax receipts stood at ₹10.82 lakh crore compared to ₹9.91 lakh crore during the same period in the previous financial year, marking a 9.18% increase. Gross tax revenue touched ₹12.43 lakh crore, growing 3.39% year-on-year. A downturn of 23.87% in issued refunds, amounting to ₹1.60 lakh crore, played a major role in boosting the net revenue figures.

Breakdown of Gross Tax Collection Components

The gross tax collection comprised ₹4.72 lakh crore from corporate tax, ₹5.83 lakh crore from non-corporate income tax, ₹26,000 crore from Securities Transaction Tax (STT), and ₹291 crore categorised under other taxes. In comparison, FY25 had gross collections of ₹12.02 lakh crore and refunds of ₹2.10 lakh crore during the same period.

Advance Tax Collection and Sectoral Contributions

Advance tax payments rose moderately by 2.90% to ₹4.48 lakh crore. Of this, corporate tax accounted for ₹3.52 lakh crore, reflecting a 6.11% increase, while the non-corporate segment contracted by 7.30%, totalling ₹96,700 crore. Last year, advance tax collections were ₹4.36 lakh crore, inclusive of ₹3.32 lakh crore and ₹1.04 lakh crore from corporate and non-corporate sources, respectively.

Read More: ITR Filing FY25: Why Your Income Tax Refund May Be Delayed and How to Track It!

Current Year’s Projections and Sector Expectations

For FY26, the government has set a direct tax collection target of ₹25.20 lakh crore, indicating a 12.7% rise over FY25’s target. The STT contribution is expected to contribute ₹78,000 crore during the year, underlining the role of capital market transactions in revenue generation.

Conclusion

India's direct tax collections have shown strong momentum in FY26, led by reduced refunds and stable inflows from corporate and advance taxes. This performance signals firm compliance and effective tax planning during the early half of the fiscal year.

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