New Delhi: India’s direct tax collections recorded steady growth in the financial year 2025–26, with net collections rising 5.12% year-on-year to ₹23.40 lakh crore, according to provisional data released by the Central Board of Direct Taxes (CBDT).
Gross Collections See Moderate Growth
The data shows that gross direct tax collections increased to ₹28.11 lakh crore in FY26, marking a 4.03% risecompared to ₹27.03 lakh crore in FY25.
This growth was primarily driven by:
- Higher corporate tax collections
- Increased securities transaction tax (STT) revenue
- Improved compliance levels
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Corporate Tax Leads Revenue Expansion
Corporate tax remained the key growth driver during the fiscal:
- Corporate Tax (FY26): ₹13.81 lakh crore
- Corporate Tax (FY25): ₹12.72 lakh crore
The increase reflects improved corporate profitability and stronger tax compliance.
Meanwhile, non-corporate tax collections—including taxes from individuals, HUFs, and firms—remained largely stable at ₹13.72 lakh crore.
STT Collections Reflect Strong Market Activity
Revenue from Securities Transaction Tax (STT) rose to:
- ₹57,522 crore in FY26
- Up from ₹53,296 crore in FY25
The rise indicates continued momentum in capital market activity, despite global uncertainties.
However, collections under “other taxes” saw a sharp decline to ₹334 crore, compared to ₹3,366 crore in the previous year.
Refunds Decline Slightly
Total refunds issued during FY26 stood at:
- ₹4.71 lakh crore, down from ₹4.76 lakh crore in FY25
- A marginal decline of 1.09%
Lower refunds contributed to higher net tax realization during the year.
Net Collections Strengthen Fiscal Position
After adjusting for refunds, net direct tax collections reached:
- ₹23.40 lakh crore in FY26
- Compared to ₹22.26 lakh crore in FY25
The 5.12% growth highlights stable revenue generation, supporting the government’s fiscal position amid global economic challenges.
Improved Compliance and Economic Formalisation
According to the Central Board of Direct Taxes, the steady rise in collections reflects:
- Better tax compliance
- Increasing formalisation of the economy
- Resilient corporate earnings
- Growth in personal incomes
The CBDT also noted that the figures are provisional and subject to revision.
Outlook
India’s direct tax performance in FY26 underscores economic resilience and improving compliance trends, even as external uncertainties persist. Sustained growth in corporate earnings and financial market activity is expected to remain key drivers in the coming fiscal.
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