Direct tax collection: Rs. 6.64 Lakh Crore Collected, Higher Refunds Impact Net Tax Revenue

Here below, we have compared direct tax collection data for the financial year 2025-26 (assessment year 2026-27) as of July 10, 2025, to that of the previous year’s data for the same period [in financial year 2025-26 (as of July 10, 2024)].

Direct tax in India is collected by the government from individuals, firms, and other entities. These taxes consist of Corporate Tax (CT) paid by companies, Non-Corporate Tax (NCT) paid by individuals, firms, and similar entities, Securities Transaction Tax (STT) on stock market transactions, and Other Taxes (OT) such as interest, penalties, etc.

1. Gross Tax Collection:

This is the total amount collected before giving any refunds to taxpayers.

In FY 2024-25, the gross collection up to July 10, 2024, was Rs. 6,44,375 crore.

• Corporate Tax (CT): Rs. 2,64,816 crore
• Non-Corporate Tax (NCT): Rs. 3,61,505 crore
• Securities Transaction Tax (STT): Rs. 16,632 crore
• Other Taxes (OT): Rs. 1,422 crore

In FY 2025-26, the gross collection up to July 10, 2025, increased slightly to Rs. 6,64,807 crore.

• CT: Rs. 2,89,773 crore
• NCT: Rs. 3,56,887 crore
• STT: Rs. 17,874 crore
• OT: Rs. 273 crore

So, there was a total growth of 3.17% in gross collections over the previous year. The increase is mainly seen in Corporate Tax and STT, while Non-Corporate Tax slightly dropped.

2. Refunds:
Refunds are the part of the tax amount that is returned to the taxpayers when they pay more tax than actually required.

In FY 2024-25, total refunds issued up to July 10 were Rs. 73,893 crore.

• CT Refunds: Rs. 57,289 crore
• NCT Refunds: Rs. 16,589 crore
• Other: Rs. 15 crore

In FY 2025-26, total refunds went up significantly to Rs. 1,01,980 crore.

• CT Refunds: Rs. 89,863 crore
• NCT Refunds: Rs. 12,114 crore
• Other: Rs. 3 crore

This demonstrates a huge increase of 38.01% in refunds this year.

The Income Tax Department has become faster and more efficient in processing and issuing refunds. This is the major cause behind this increase. This leads to better services reaching taxpayers.

3. Net Tax Collection:

Net Tax Collection is the actual amount the government keeps after paying back refunds:

• In financial year 2024-25, net tax collection was Rs. 5,70,483 crore.
• In financial year 2025-26, net tax collection is slightly lower at Rs. 5,62,827 crore.

This means there is a small drop of 1.34% (negative) in the net collection this financial year in comparison to the previous FY. The kay reason behind this decrease is that more refunds have been given out this FY.