NewKerala.com

India's Direct Tax Collections Jump 9.4% in FY26, Refunds Decline Sharply

India's net direct tax collections for FY26 have grown robustly by 9.40%, reaching nearly Rs 19.44 lakh crore. Corporate tax collections saw a notable increase, while refunds issued dropped sharply by over 18%. Finance Minister Nirmala Sitharaman, during the budget debate, affirmed the Centre's commitment to devolving 41% of taxes to states. She highlighted that states' estimated share for the coming year has increased significantly.

Key Points: India's FY26 Direct Tax Growth Hits 9.4%, Refunds Down 18.8%

  • Net direct tax up 9.40%
  • Corporate tax collections rise significantly
  • Refunds issued decline by 18.82%
  • Finance Minister assures 41% tax devolution to states
2 min read

Net direct tax collections spike by 9.40% in FY26

India's net direct tax collections rise to Rs 19.44 lakh crore in FY26, with corporate tax showing strong growth. Finance Minister details state fund devolution.

"We have transferred 41% of the divisible pool to the states. No state's share has been reduced. - Nirmala Sitharaman"

New Delhi, February 11

India's net direct tax collections for the financial year 2025-26 have recorded a robust growth of 9.40 per cent, reaching Rs 19,43,743.97 crore as of February 10, 2026, compared to Rs 17,76,728.11 crore in the corresponding period of the previous fiscal, data released by the Income Tax Department said on Wednesday.

According to official data, gross direct tax collections stood at Rs 22,78,068.60 crore, marking a 4.09 per cent increase over Rs 21,88,554.86 crore collected during the same period last year.

Refunds issued during the period declined by 18.82 per cent to Rs 3,34,324.63 crore, compared to Rs 4,11,826.75 crore in the previous financial year.

Corporate tax collections (net) rose to Rs 8,89,752.90 crore in FY26 (as on February 10), up from Rs 7,77,047.63 crore in the same period last year.

Non-corporate tax collections, which include taxes paid by individuals, HUFs, firms and other entities, increased to Rs 10,03,385.52 crore from Rs 9,47,477.30 crore a year earlier.

Securities Transaction Tax (STT) collections remained broadly stable at Rs 50,279.17 crore, compared with Rs 49,201.40 crore in the previous fiscal.

Replying to the debate in the Lok Sabha on the Union Budget 2026-27, Union Finance Minister Nirmala Sitharaman assured that a 41% share of taxes is devolved to the States. "We have transferred 41% of the divisible pool to the states. No state's share has been reduced."

"In the coming year, the States' share is estimated at Rs 25.44 lakh crore, which is devolved to them, an increase of Rs 2.7 lakh crore from last year," she said.

She cited the 16th Finance Commission and said it had analysed the devolution of funds from 2018 to 2023 and concluded that the Centre's transfers to states during each of those years matched the Commission's recommendations.

- ANI

Share this article:

Reader Comments

R
Rohit P
Good to see corporate tax collections rising significantly. It indicates businesses are doing well, which should eventually lead to more jobs. However, as a salaried individual, I hope the government considers some relief in personal income tax slabs in the next budget. The burden on the middle class is still high.
A
Aman W
The 18% drop in refunds is interesting. While it boosts net collections, I hope it doesn't mean delays in processing our IT returns. The department should ensure timely refunds, especially for honest taxpayers. Efficiency in collection should be matched by efficiency in service.
S
Sarah B
As someone who recently started investing, I'm glad to see STT collections are stable. It shows sustained activity in the markets. The overall numbers are promising, but I'd like to see more transparency on how these increased funds are being allocated, particularly for healthcare and education.
V
Vikram M
Solid numbers! The increase in non-corporate tax (which includes us individuals) shows more people are coming into the tax net, which is healthy for the country. The FM's point about 41% devolution to states is vital – development needs to reach every corner of India. Jai Hind! 🇮🇳
K
Karthik V
While the growth is commendable, we must ask: is this due to better economic activity or simply more aggressive tax scrutiny and higher effective rates? The government should ensure the tax system remains fair and doesn't stifle the entrepreneurial spirit, especially for small businesses and startups.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50