Net direct tax collections jump 23% to ₹8.11 trillion by 10 August

India’s net direct tax collections rose 23.09% year-on-year to ₹8.11 trillion between 1 April and 10 August, from ₹6.59 trillion in the corresponding period a year earlier, pointing to strong tax revenue mobilization early in FY27 and outpacing the growth assumed for the broader economy in the Union budget.

According to provisional tax collection data released by the government on Tuesday, gross direct tax collections increased 19.75% to ₹9.55 trillion, from ₹7.97 trillion in the year-earlier period.

The data are significant for the government’s finances because direct taxes are a major source of revenue for funding expenditure and keeping the fiscal deficit on track. The FY27 budget has pegged the Centre’s net tax revenue at ₹28.67 trillion, while gross receipts from corporation tax and taxes on income, including securities transaction tax, are budgeted at about ₹26.97 trillion.

The ₹9.55 trillion gross direct tax collection by 10 August is equivalent to roughly 35% of the ₹26.97 trillion budgeted from corporation tax and taxes on income for the full year. This is notable given that only a little over four months of FY27 had elapsed by 10 August.

Non-corporate taxes lead

The strongest contribution came from non-corporate tax, which includes taxes paid by individuals, Hindu undivided family (HUFs), firms, associations of persons, bodies of individuals, local authorities and artificial juridical persons.

Gross collections under this category rose 22.29% to ₹5.41 trillion, from ₹4.42 trillion a year earlier.

Corporate tax collections also increased, but at a slower pace, rising 14.33% to ₹3.80 trillion from ₹3.32 trillion in the year-earlier period. Non-corporate taxes therefore accounted for more than half of gross direct tax collections during the period and grew substantially faster than corporate tax.

Securities transaction tax (STT) recorded the sharpest growth among the major components, rising 51.30% to ₹33,823.74 crore from ₹22,354.31 crore a year earlier.

The rise in STT collections points to continued activity in the securities market, although STT remains a relatively small component of overall direct-tax receipts.

Refunds remain subdued

Refunds rose only 3.79% to ₹1.43 trillion from ₹1.38 trillion a year earlier. As a result, net collections grew faster than gross collections—23.09% compared with 19.75%.

“Data shows strong growth in gross non-corporate taxes and STT collections, and a slowdown in refunds. This is leading to 23% growth in net collections. It is expected, however, that the pace of refunds will increase over the next few months,” said Rohinton Sidhwa, partner, Deloitte India.

Gross corporate tax collections, meanwhile, are growing at a more modest 14%, Sidhwa said.