India's net direct tax collections rose 13% year-on-year to over ?12.12 lakh crore between April 1 and September 17 of the current financial year, driven in part by higher advance tax payments, according to data released by the Central Board of Direct Taxes (CBDT) on Friday (September 18).
Gross direct tax collections grew 15% year-on-year to over ?14.32 lakh crore during the period.
Within the net collections, corporate tax mop-up increased 19.48% year-on-year to about ?5.56 lakh crore, while collections from non-corporate taxes, which include taxes paid by individuals and Hindu Undivided Families (HUFs), rose 6% to over ?6.16 lakh crore.
Securities Transactions Tax (STT) collections also recorded strong growth, rising 53% to ?40,214 crore between April 1 and September 17.
Meanwhile, tax refunds issued during the period increased 29.19% to over ?2.20 lakh crore, according to the CBDT data. The higher refunds partly explain the difference between gross and net direct tax collections.
Advance tax collections, an indicator of tax payments made during the year based on estimated income, rose 16.18% to about ?5.22 lakh crore till September 17.
Advance corporate tax payments grew 18% to over ?4.16 lakh crore, while non-corporate advance tax payments increased 9.24% to ?1.06 lakh crore.
Securities Transactions Tax (STT) collections recorded a sharp 53% increase to ?40,214 crore during the period. Meanwhile, refunds issued by the tax department jumped 29.19% to over ?2.20 lakh crore, moderating the growth in net collections compared with gross collections.
Richa Sawhney, Partner - Tax, Grant Thornton Bharat, said the direct tax numbers continue to signal healthy underlying economic activity and the strength of the tax base.
“While higher refunds have moderated net tax collection growth, they also reflect improved efficiency in refund processing, ensuring timely relief and liquidity for taxpayers,” Sawhney said.
She added that the steady growth in advance tax payments was a positive indicator of taxpayer confidence, business performance and expectations of sustained income growth.
Sumeet Hemkar, Partner, Deloitte India, said the 18% increase in corporate advance tax and more than 9% rise in non-corporate advance tax pointed to a positive outlook for FY27 compared with the corresponding period of the previous financial year.
He said the strongest growth was in STT collections, which rose nearly 53%, amid increased F&O trading, higher retail participation and an improvement in market valuations.
However, Rohinton Sidhwa, Partner, Deloitte India, said the rise in STT collections appeared to be driven primarily by the increase in STT rates announced in Budget 2026, rather than an increase in trading turnover.
A 150% increase in the STT rate on equity futures took effect from April 1, 2026, Sidhwa noted. He also pointed to the nearly 29% increase in refunds and strong corporate advance tax growth as positive trends.
Amit Maheshwari, Managing Partner, AKM Global, said the direct tax collection trends were broadly consistent with the momentum in the domestic economy, which recorded 7.8% real GDP growth in the first quarter of FY27, supported by investment, manufacturing and household consumption.
“While tax collections cannot by themselves be viewed as a direct measure of economic growth, the sustained increase in corporate and advance tax collections provides an indication of continued income and business activity during the period,” Maheshwari said.
He added that the 29.19% increase in refunds highlighted the need to balance stronger revenue mobilisation with efficient processing of legitimate tax claims. Sustaining economic activity, broadening the tax base and strengthening technology-led compliance would remain important for maintaining the pace of revenue growth, he said.
Hemkar said the latest numbers suggested that the government was firmly on track towards meeting or exceeding its Budget estimates for direct tax collections for FY27.
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