New Delhi: India’s net direct tax collections increased 13 per cent to ₹12.10 lakh crore during the current financial year, supported by stronger advance tax payments and continued growth in tax revenues.
The latest figures indicate sustained momentum in government revenue collection and provide an important indicator of economic activity across businesses and households.
Advance-tax payments have been a key contributor to the increase, reflecting tax payments made by companies and individuals during the financial year. Higher collections can provide the government with greater fiscal resources for expenditure on infrastructure, public services and other development programmes.
The rise in direct tax revenue also comes as India continues to monitor economic conditions amid elevated global uncertainty, fluctuations in energy prices and changing international trade conditions.
Corporate tax and personal income tax collections form a significant part of the direct-tax framework. Improvements in compliance, digital tax administration and advance payments have contributed to the expansion of the tax base in recent years.
The latest revenue data will be closely watched by policymakers as they assess progress against the government’s fiscal targets for the year. Stronger-than-expected collections can help provide additional fiscal flexibility, although the overall position will also depend on expenditure trends and other sources of government revenue.
The increase in direct tax collections comes alongside expectations of continued economic growth. Moody’s has separately raised its forecast for India’s FY27 economic growth to 7 per cent, citing resilience in domestic economic activity while warning of inflation related risks.
The revenue figures therefore provide another indicator of the underlying strength of India’s economy as policymakers navigate global economic and geopolitical challenges.