India's net direct tax collection demonstrated robust growth in the current fiscal year, rising 15.2% to over ₹14.3 lakh crore till September 17, according to the latest provisional data released by the Central Board of Direct Taxes (CBDT). The government's gross direct tax collection achieved an even stronger performance with 15% growth totalling over ₹14.32 trillion. This positive trend reflects effective tax administration and improved taxpayer compliance during the initial months of the fiscal year. The data shows net direct tax collections stood at ₹14,30,000 crore as of September 17, 2026, compared with ₹12,35,000 crore in the corresponding period last year. After adjusting for refunds, net collections from direct taxes registered a 12.96% growth at over ₹12.12 lakh crore. As per Business Standard, this represents about 45% of the full-year direct tax collection target of ₹26.97 trillion, though direct tax revenue has grown slower than the 15.25% needed to achieve the full-year target compared with last fiscal's actual collection of ₹23.40 trillion.
Corporate tax collections emerged as the primary driver of growth, with corporate tax mop-up growing 19.48% to about ₹5.56 trillion. Non-corporate tax collections from individuals and Hindu Undivided Families (HUFs) also contributed positively, increasing 6% to over ₹6.16 trillion. The advance tax component showed particularly strong performance, with advance tax mop-up rising 16.18% to about ₹5.22 trillion during the period. Corporate advance tax collections grew 18.09% to ₹4,16,083.59 crore, while non-corporate advance tax collections increased 9.24% to ₹1,05,856.69 crore. According to EY India's Tax Partner Jayesh Sanghvi, the current growth indicates that the buoyancy is broad-based, with non-corporate tax now accounting for 48.7% of the gross pie versus corporate tax's 48.5%. As per Deloitte India's Partner Rohinton Sidhwa, the over 50% increase in STT collection seems to be primarily driven by rate hikes in Budget rather than an increase in turnover, with a 150% rate hike made in STT rates on equity futures effective April 1, 2026.
Securities Transactions Tax (STT) collection demonstrated exceptional growth, increasing 53% to ₹40,214 crore between April 1 and September 17. This sharp jump in securities tax collections follows higher STT rates effective from April 1, with the levy on futures raised to 0.05% and that on options premium turnover increased to 0.15%. From April 1, STT on futures was increased to 0.05% of traded value from 0.02% earlier, while options tax on premium turnover was raised to 0.15% from 0.10%. The levy on exercised options was also increased to 0.15% of intrinsic value from 0.125%. Since 2024, this was the second hike in STT by the government. In FY26, total STT collection stood at ₹57,522 crore compared to ₹53,296 crore in FY25. The government has projected a STT mop-up of ₹73,700 crore from STT in fiscal 2026-27. As per Nangia Global's Senior Partner Aravind Srivatsan, the growth in capital market tax collections paints the resilience of Indian stock market, trading volumes and impact of IPO activity post Covid. According to Price Waterhouse & Co LLP's Partner Hitesh Sawhney, STT has already reached about 55% of its full-year Budget Estimate of ₹73,700 crore.
Refund issuance showed remarkable improvement, jumping 29.2% to over ₹2.20 trillion till September 17. This substantial increase in refund processing reflects the government's enhanced efficiency in tax refund administration and improved taxpayer service delivery. The significant growth in refunds indicates better taxpayer compliance and faster processing of legitimate refund claims. The data shows refunds during the period jumped to ₹2,20,026.72 crore against ₹1,70,310.28 crore in the year-ago period. Within this, non-corporation tax refunds more than doubled to ₹81,439 crore, as per the latest official numbers. According to Grant Thornton Bharat's Partner Richa Sawhney, direct tax collections continue to signal healthy underlying economic activity and the strength of the tax base, with steady growth in advance tax payments remaining a positive indicator of taxpayer confidence, business performance and expectations of sustained income growth. As per Price Waterhouse & Co LLP's Partner Hitesh Sawhney, despite these enhanced refunds, net tax collections have grown at a steady pace, with overall net tax collections remaining higher by ₹1.39 trillion.
The tax collection trends are broadly consistent with underlying momentum in the domestic economy, with the sustained increase in corporate and advance tax collections providing an indication of continued income and business activity during the period. As per EY India's Tax Partner Jayesh Sanghvi, gross direct tax buoyancy runs at roughly 1.47 and net buoyancy at 1.26, a meaningful reversal from FY2025-26. Nominal GDP for Q1 FY27 grew 10.3%, and the FY27 Budget assumes full-year nominal growth of 10%. Within advance tax payments, the second installment showed a 16.2% growth to ₹5.2 lakh crore, faster than the 15.3% rise in the first installment paid in June. Corporate advance tax payouts by companies increased by 18.1% to a little under ₹4.2 lakh crore, again faster than the 16% growth clocked in June. In case of personal income tax, however, growth slowed from 12.8% to 9.2% (around ₹10.6 lakh crore after the second installment). The government has budgeted to collect ₹26.97 lakh crore from direct taxes in the current financial year, a 15% growth over ₹23.40 lakh crore collected in FY26. The actual net direct tax collection for FY26 was ₹23.40 trillion, lower than the revised estimate of ₹24.21 trillion, with a shortfall of around ₹81,000 crore.
