India’s Net Direct Tax Collections Rise Nearly 13% to ₹12.12 Lakh Crore as Corporate Advance Tax Strengthens

India’s direct tax collections continued to record strong growth during the first half of FY2026-27, with net collections rising to more than ₹12.12 lakh crore by 17 September 2026. The increase was supported by higher corporate tax receipts, stronger advance tax payments and a sharp rise in Securities Transaction Tax collections.

Data released by the Central Board of Direct Taxes showed that net direct tax collections stood at ₹12,12,410.71 crore between 1 April and 17 September 2026. This represented a year-on-year increase of 12.96% compared with ₹10,73,272.17 crore collected during the corresponding period of FY2025-26.

The figures provide an important indication of the revenue position of the Union government during the first half of the financial year and also offer an early view of corporate profitability and income growth across the economy.

Gross Direct Tax Collections Cross ₹14.32 Lakh Crore

Before adjusting for refunds, India’s gross direct tax collections reached ₹14,32,437.43 crore by 17 September 2026. This was 15.19% higher than the ₹12,43,582.45 crore collected during the corresponding period of the previous financial year.

Gross collections include corporate income tax, non-corporate income tax and Securities Transaction Tax before refunds are deducted. The faster growth in gross collections compared with net collections reflects a substantial increase in refunds issued during the same period.

The widening tax base and higher advance payments from businesses contributed significantly to the increase in gross revenue.

Corporate Tax Collections Show Strong Growth

Corporate tax receipts remained one of the strongest components of the direct tax performance. Gross corporate tax collections rose to around ₹6.95 lakh crore by 17 September, compared with roughly ₹5.96 lakh crore during the corresponding period of the previous year.

After adjusting for refunds, net corporate tax collections increased to approximately ₹5.56 lakh crore. This represented growth of about 19.48% compared with the same period in FY2025-26.

The pace of corporate tax growth is significant because these receipts are closely linked to company earnings and taxable profits. Stronger payments during the first half of the year indicate that profitability among a broad section of companies remained supportive of government revenues.

Non-Corporate Tax Collections Also Increase

Non-corporate tax collections, which include taxes paid by individuals, Hindu Undivided Families and other non-corporate taxpayers, also increased during the period.

Gross non-corporate tax collections reached around ₹6.98 lakh crore, compared with approximately ₹6.22 lakh crore in the previous year. After refunds, net non-corporate collections stood at more than ₹6.16 lakh crore, representing growth of around 6%.

Although the growth rate was lower than that recorded in corporate taxes, the size of non-corporate receipts continued to make them one of the largest components of India’s direct tax base.

Advance Tax Collections Rise More Than 16%

Advance tax collections provided another important indication of revenue strength.

Total advance tax receipts reached ₹5,21,940.72 crore by 17 September 2026, compared with ₹4,49,256.41 crore during the corresponding period of the previous year. This represented year-on-year growth of 16.18%.

Advance tax is paid during the financial year rather than after its completion and is therefore closely watched as an indicator of expected income and profitability.

Corporate advance tax collections rose particularly strongly, increasing 18.09% to ₹4,16,083.59 crore. Non-corporate advance tax receipts reached ₹1,05,856.69 crore, registering growth of 9.24%.

The stronger corporate component suggests that companies entered the second half of the financial year with relatively healthy taxable earnings.

Securities Transaction Tax Surges Nearly 53%

One of the fastest-growing components of direct tax revenue was the Securities Transaction Tax.

STT collections increased to ₹40,214.36 crore between 1 April and 17 September 2026, compared with ₹26,305.72 crore during the corresponding period of the previous financial year. This represented an increase of about 52.9%.

The rise reflects a combination of strong activity in India’s securities markets and changes in applicable STT rates, particularly in derivatives transactions.

While STT remains much smaller than corporate or personal income tax in absolute terms, its rapid growth has made it an increasingly visible contributor to direct tax receipts.

Refunds Rise to ₹2.20 Lakh Crore

Tax refunds issued by the government also increased sharply during the period.

Refunds totalled ₹2,20,026.72 crore up to 17 September 2026, compared with ₹1,70,310.28 crore during the corresponding period of the previous year. This represented an increase of 29.19%.

The higher level of refunds moderated the growth rate of net collections relative to gross receipts. Gross direct tax revenue rose more than 15%, while net collections increased by just under 13% after refunds were deducted.

The increase in refunds also means that the difference between gross and net revenue widened during the first half of FY2026-27.

Collections Running Ahead of Budgeted Growth Rate

The Centre’s direct tax target for FY2026-27 is around ₹26.97 lakh crore. Collections up to 17 September represented close to 45% of that full-year target.

The Budget had assumed direct tax growth of around 11.4% for the financial year. Net collections were growing at 12.96% by mid-September, placing the year-to-date increase above the growth rate built into the Budget assumption.

Maintaining this momentum through the second half of the year will depend on corporate profitability, personal income growth, capital-market activity and overall economic performance.

Corporate Advance Tax Provides an Important Signal

Among the various components of the September data, corporate advance tax growth is particularly notable.

Companies calculate advance tax on the basis of expected taxable income during the financial year. An 18.09% increase in these payments therefore suggests that aggregate taxable profits among companies making advance payments have increased compared with the previous year.

Advance tax figures are not a complete measure of corporate performance, and they can be influenced by timing and tax adjustments. Nevertheless, they provide an early revenue signal before final annual tax liabilities are assessed.

Combined with the increase in overall corporate tax collections, the advance tax data strengthens the evidence of higher corporate tax contributions during FY2026-27.

Direct Taxes Strengthen the Revenue Position

Direct taxes have become an increasingly important component of India’s government revenue structure as formalisation, digitisation of tax administration and expansion of the taxpayer base have increased collections over time.

The latest figures show that this trend continued during the first half of FY2026-27. Gross receipts expanded across corporate and non-corporate categories, advance tax collections remained firm and securities-market taxation contributed significantly higher revenue.

At the same time, the sharp rise in refunds demonstrates why gross and net collections need to be considered separately when assessing the government’s fiscal position.

With net collections already above ₹12 lakh crore before the end of September, direct tax revenues entered the second half of the financial year with double-digit year-on-year growth.

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References

Income Tax Department, Ministry of Finance — Direct Tax Collections for FY2026-27
https://www.incometaxindia.gov.in/

Central Board of Direct Taxes — Direct Tax Collection Data up to 17 September 2026
https://incometaxindia.gov.in/

DD India — Net Direct Tax Collection Rises 13% to ₹12.12 Lakh Crore, 18 September 2026
https://ddindia.co.in/2026/09/net-direct-tax-collection-rises-13-percent-to-rs-12-12-lakh-crore-on-higher-advance-tax-mop-up/

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