Net direct tax kitty swells 8% on strong India Inc show

New Delhi: Net direct tax collections rose 8% to ₹17.05 lakh crore in the current financial year till December 17, backed by double-digit growth in corporate tax payments and a decline in refunds from the year-earlier period, according to official data released on Friday.

Experts said the latest numbers point to strong corporate performance, but the government could miss its budgeted target. The government has budgeted its direct tax collections at ₹25.20 lakh crore, a growth of 13% year-on-year.

Advance tax payments grew 4.3% to over ₹7.88 lakh crore in the period under review, the data showed. Advance tax paid by corporates recorded a growth of 8% to more than ₹6.07 lakh crore.


Shortfall Likely in Income Tax Collection
Collections are expected to rise further with the approaching December 31 deadline for the filing of revised returns, officials said.

“Overall, the increase in corporate advance tax signals strong corporate earnings, while non-corporate advance tax collections have declined, possibly due to the rate cuts for individuals announced in the budget,” said Rohinton Sidhwa, partner, Deloitte India.

Corporate tax collections rose 10.7% to ₹8.17 lakh crore. Net non-corporate tax collections, which include taxes paid by individuals and other entities, increased to ₹8.47 lakh crore in April-December 17 period from ₹7.39 lakh crore a year ago. Securities transaction tax (STT) collections were largely flat at around ₹40,195 crore.

“Tax collections are expected to remain subdued and may fall short of the government’s projections for the current year,” said Amit Maheshwari, Tax Partner, AKM Global, a tax and consulting firm.

Rating agency ICRA expects a sizable shortfall in personal income tax collections relative to the FY26 Budget target of Rs13.6 lakh crore, which implies 15% growth over the FY25 provisional figure.