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India's Direct Tax Collections Surge 8.8% to Rs 18.38 Lakh Crore in FY26

India's net direct tax collections for the financial year 2025-26 have grown by 8.82% to reach Rs 18.38 lakh crore as of January 11. Gross collections stood at Rs 21.50 lakh crore, with corporate and non-corporate taxes showing steady increases. A sharp 16.92% decline in refunds issued contributed significantly to the higher net collections. Economists anticipate the upcoming Union Budget will focus on growth and capital expenditure while aiming to meet fiscal targets.

Key Points: India's FY26 Direct Tax Collections Grow 8.82% to Rs 18.38 Lakh Cr

  • Net direct tax up 8.82%
  • Gross collections at Rs 21.50 lakh crore
  • Refunds decline sharply by 16.92%
  • Budget 2026 to be presented Feb 1
2 min read

India's net direct tax collections in FY26 rise, grow 8.82% to Rs 18.38 lakh crore till Jan 11

India's net direct tax collections for FY26 rise to Rs 18.38 lakh crore by Jan 11, marking 8.82% growth. Refunds decline sharply, boosting net revenue.

"We expect the government to meet its fiscal deficit target of 4.4% for FY26. - Sonal Badhan"

New Delhi, January 12

India's net direct tax collections for the financial year 2025-26 have recorded a strong growth of 8.82 per cent, reaching Rs 18.38 lakh crore as of January 11, 2026, compared with Rs 16.89 lakh crore collected during the same period last year, according to official data released by the Income Tax Department on Monday.

Gross direct tax collections stood at Rs 21.50 lakh crore, marking a 4.14 per cent increase over the Rs 20.64 lakh crore collected in the corresponding period of FY25. Corporate tax collections rose modestly to Rs 10.47 lakh crore, while non-corporate tax collections, which include taxes paid by individuals and other entities, increased to Rs 10.58 lakh crore.

The Union Budget 2026 will be presented on February 1.

Refunds issued during the period declined sharply by 16.92 per cent to Rs 3.12 lakh crore, compared with Rs 3.75 lakh crore in the previous year, contributing to higher net collections. Net corporate tax collections rose to Rs 8.63 lakh crore, while net non-corporate tax collections increased significantly to Rs 9.30 lakh crore.

Securities Transaction Tax (STT) collections remained stable at around Rs 44,867 crore, while collections from other taxes were marginal during the period.

Earlier, in an email interview with ANI, Sonal Badhan, Economist at Bank of Baroda said the Union Budget 2026 is likely to set 8.5-9% growth for next year and increase capital expenditure to Rs 12-12.2 lakh crores.

"We expect the government to meet its fiscal deficit target of 4.4% for the Financial Year 2026 (FY26). For next year, we estimate that the deficit ratio will be lowered by 30-40bps (4-4.1%). Capex allocation will be of key interest. In the ongoing fiscal year, the government has already met approximately 60% of the budgeted target till Nov'25," the BoB Economist said.

- ANI

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Reader Comments

S
Sarah B
As someone who filed for a refund this year, the 17% decline mentioned is worrying. Are processing times getting longer? The overall numbers are positive, but the taxpayer experience matters too.
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Arjun K
Solid numbers! ₹18.38 lakh crore is no small amount. This should give the govt good headroom for the upcoming budget. Expecting some relief for the middle class in the tax slabs 🤞. More money in hand means more spending, which fuels the economy.
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Priyanka N
The split between corporate and non-corporate is almost equal. That's a healthy sign, shows individual taxpayers and smaller businesses are contributing significantly. Hope the capex increase to ~₹12 lakh crore happens. Our roads and railways need it! 🚄
K
Karthik V
While the growth is good, I wish the article broke down the "non-corporate" part more. How much is from salaried employees vs. professionals/businesses? Salaried folks have TDS, so compliance is 100%. Need to widen the tax base further.
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Michael C
Meeting the fiscal deficit target of 4.4% would be a major achievement alongside this tax growth. Prudent fiscal management is key for long-term stability and attracting foreign investment. Positive data point.

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