NewKerala.com

Key Points

India's gross direct tax collections for FY26 rose by 4.86% to Rs 5.45 lakh crore, though net collections dipped slightly due to higher refunds. Corporate advance tax payments grew by 5.86%, while non-corporate collections declined. The government is reviewing the Income-tax Act to simplify tax laws and reduce disputes. A new Income Tax Bill, proposing a revised tax structure, is set for discussion in the upcoming monsoon session.

Key Points: India's FY26 Direct Tax Collections Rise 4.86% Despite Higher Refunds

  • Gross direct tax rises 4.86% to Rs 5.45 lakh crore
  • Net collections dip 1.39% due to 58% higher refunds
  • Corporate advance tax grows 5.86% while non-corporate declines
  • New Income Tax Bill aims to simplify tax structure
2 min read

Direct tax collections rise 4.86% in FY26 so far, net collections dip on higher refunds

India's gross direct tax collections grow 4.86% to Rs 5.45 lakh crore in FY26, though net collections dip due to increased refunds and corporate tax strength.

"The fall in net collections is primarily attributed to a sharp 58% jump in refunds issued, reflecting faster processing. – Income Tax Department"

New Delhi, June 21

India's gross direct tax collections for the financial year 2025-26 rose by 4.86 per cent to about Rs 5.45 lakh crore as of June 19, compared to about Rs 5.19 lakh crore collected during the same period last year, according to data released by the Income Tax Department.

However, net direct tax collections saw a marginal decline of 1.39 per cent, dropping to Rs 4.59 lakh crore. The fall is primarily attributed to a sharp 58 per cent jump in refunds issued, reflecting faster processing and improved taxpayer services.

Advance tax collections during the period stood at Rs 1.56 lakh crore, registering a growth of 3.87 per cent. This was led by a 5.86 per cent increase in corporate advance tax payments, even as collections from non-corporate taxpayers declined by 2.68 per cent.

The data shows that while corporate tax collections remained strong, the Securities Transaction Tax (STT) saw a decline, and overall growth momentum in collections appears moderated by elevated refund outflows.

Recently, the Income Tax Department has introduced the 'e-Pay Tax' feature on its official online portal to facilitate the taxpayers by easing various processes, according to the CBDT.

Additionally, in the July 2024 Budget, the government proposed a comprehensive review of the Income-tax Act of 1961. The purpose was to make the Act concise and lucid, thereby reducing disputes and litigation.

Meanwhile, on March 25, Union Finance and Corporate Affairs Minister Nirmala Sitharaman said that the new Income Tax Bill will be taken up for discussion in the monsoon session of Parliament. The Finance Minister has already announced in his budget speech that with the revised tax structure, individuals earning up to Rs 12 lakhs will have no tax liability due to the increased rebate of Rs 60,000.

Earlier on March 18, the government encouraged the stakeholders to submit their suggestions on the newly introduced Income Tax Bill 2025. The Bill is currently under examination by the Select Committee for detailed consideration.

- ANI

Share this article:

Reader Comments

R
Rahul K.
Good to see faster refund processing by IT department! 👏 Earlier we had to wait months for refunds. The e-Pay Tax feature is also very convenient. Hope the new simplified tax law reduces unnecessary litigation and makes compliance easier for common people.
P
Priya M.
While the growth in corporate tax is positive, the decline in non-corporate advance tax is concerning. Many small businesses are still recovering from pandemic effects. Government should consider more relief measures for MSME sector in the new tax bill.
A
Amit S.
The ₹12 lakh tax exemption limit is a welcome move for middle class. But with inflation rising, this threshold should be increased further. Also, why is STT declining when stock markets are at all-time high? Something doesn't add up.
S
Sunita R.
Digital initiatives like e-Pay Tax are good, but many senior citizens still struggle with online processes. IT department should maintain physical help centers too. The 58% jump in refunds shows improved efficiency, but hope this doesn't compromise scrutiny of fraudulent claims.
V
Vikram J.
As a CA, I welcome the move to simplify Income Tax Act. The current law has become too complex with numerous amendments. However, the government must ensure the new law doesn't create fresh ambiguities. The select committee should consult practicing professionals extensively.
N
Neha P.
Marginal dip in net collections isn't alarming considering higher refunds. The real test will be post-monsoon when more tax payments are due. Hope the new bill addresses the inverted tax structure where salaried class pays more tax than business income in same bracket.

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

Leave a Comment

Minimum 50 characters 0/50