Net direct tax mop-up up 7.2% on corporate inflows

New Delhi: Net direct tax collections for this fiscal up to March 17 rose 7.2% year-on-year to ₹22.80 lakh crore, driven by stronger corporate tax inflows, official data showed on Wednesday.

Collections remain below the revised estimate of ₹24.84 lakh crore for FY26 by ₹2.04 lakh crore, though officials expect last-minute filings to narrow the gap.

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Corporate advance tax collections grew by 9.5% on year to ₹8.29 lakh crore, while non-corporate advance tax declined 1.8% to ₹2.83 lakh crore, reflecting the lingering impact of last year's tax cut for individual taxpayers.

Net corporate tax collections stood at ₹10.91 lakh crore as on March 17, signalling strong earnings and robust corporate compliance. Non-corporate taxes, comprising mainly personal income tax, totalled ₹11.32 lakh crore.

Experts said despite the moderate growth, healthy corporate tax numbers reflect a silver lining, showing stronger income by corporates.

Advance tax collections rose 6.4% to ₹11.13 lakh crore. Corporate advance tax jumped 9.5% to ₹8.29 lakh crore, while non-corporate advance tax declined 1.8% to ₹2.83 lakh crore.

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Issuance of refunds fell 5.9% to ₹4.34 lakh crore, pointing to tighter scrutiny and increased use of automated systems to curb erroneous or fraudulent claims.

Gross direct tax collections stood at Rs 27.14 lakh crore, up 4.86% from a year ago.

"The 7% growth in net collections was driven primarily by corporate tax," said Rohinton Sidhwa, partner at Deloitte India. The rise in corporate advance taxes signals "higher earnings on the back of economic growth," he said.

"Refunds continue to contract due to automated scrutiny designed to reduce fraudulent claims," he added.