New Delhi: The government’s net direct tax collections grew 5.12% year-on-year to ₹23.40 trillion in 2025-26, compared with ₹22.26 trillion in FY25. However, the figure fell short of the revised estimate of ₹24.21 trillion set for the fiscal year ended March 2026, signalling a gap between policy projections and realised inflows.
The revised estimates had included ₹11.09 trillion from corporate tax and ₹13.12 trillion from personal income tax, including securities transaction tax (STT). Actual collections came in slightly lower on both fronts, with net corporate tax at ₹10.99 trillion and personal income tax, including STT, at about ₹12.41 trillion.
Gross direct tax collections rose 4.03% to ₹28.12 trillion, up from ₹27.03 trillion in the previous fiscal, reflecting continued expansion in the tax base and steady compliance. The growth trajectory, while moderate, indicates underlying economic stability even as global conditions remain uncertain.
A closer look at the composition reveals diverging trends. Corporate tax collections increased to ₹13.81 trillion from ₹12.72 trillion in FY25, pointing to stable corporate profitability across sectors. In contrast, non-corporate tax collections — which include individuals, Hindu Undivided Families (HUFs), firms and other entities — stood at ₹13.72 trillion, marginally below ₹13.73 trillion recorded a year earlier. This slight dip may reflect variations in income growth or shifts in taxpayer behaviour and planning.
STT collections rose to ₹57,522 crore, signalling sustained momentum in equity market activity despite intermittent volatility.
Refund dynamics played a crucial role in shaping net collections. Refund issuance declined 1.09% year-on-year to ₹4.71 trillion, compared with ₹4.76 trillion in FY25. The moderation in refunds helped support net revenue growth, even as gross collections expanded at a slower pace.
Experts note that the data points to a balanced tax structure, with both corporate and individual taxpayers contributing significantly to the exchequer. Also, the sharper rise in corporate tax relative to non-corporate collections hints at an evolving revenue mix.
The FY26 outcome reinforces the impact of digitisation, improved compliance mechanisms and the ongoing formalisation of the economy. However, the “miss” from the government’s revised targets highlights the challenges of forecasting in a fluid economic environment, experts say.