Direct tax mopup 20% bigger in FY25 on income tax boost

New Delhi: Direct tax collections surged nearly 20% from a year earlier to ₹5.74 lakh crore in FY25 so far, riding a jump in personal income tax flows. This should provide the government with more fiscal flexibility in the budget for this fiscal year, which will be presented on July 23.

Personal income tax collection is seen rising further, with some individuals expected to pay taxes with the returns for FY24. The last date for filing income tax returns is July 31 for the assessment year 2024-25.

"Corporate profits continue to surge, and these are reflected in the first quarter advance tax collections," said Rohinton Sidhwa, partner at Deloitte India. "Strong collections... indicate the possibility of the government reining in the fiscal deficit" further than estimated.


In the interim budget for FY25, the government had pegged the fiscal deficit at 5.1% of gross domestic product (GDP).

Net corporate tax collection for the fiscal as of July 11 was ₹2.10 lakh crore, an increase of 12.5%, while net personal income tax collection was up 21.4% to ₹3.46 lakh crore, according to data released on Saturday.

The Centre collected ₹16,634 crore in securities transaction tax (STT) during April 1 and July 11 on the back of the booming stock market and increased trading - more than double the ₹7,285 crore in the same period last year.

Other direct taxes - including the equalisation levy, fringe benefit tax, wealth tax and banking cash transaction tax - netted ₹1,413 crore.

The Income Tax Department has issued refunds aggregating to ₹70,902 crore in the fiscal year so far, 62.5% higher than those issued last year.

Gross tax collection before refunds was ₹6.45 lakh crore, up 23.2% from a year earlier.

The interim budget pegged direct tax collection at ₹21.99 lakh crore for the full fiscal year.

Personal income tax contributed ₹3.61 lakh crore to gross collections, while corporate tax added ₹2.65 lakh crore.