India’s gross direct tax collections for the financial year 2025-26 rose by 4.86 per cent to approximately Rs 5.45 lakh crore as of June 19, as per data released by the Income Tax Department. This marks an increase from Rs 5.19 lakh crore collected during the same period in the previous fiscal.
However, net direct tax collections saw a slight decline of 1.39 per cent, falling to Rs 4.59 lakh crore. The dip has been primarily attributed to a significant 58 per cent jump in refunds issued, indicating enhanced processing speed and improved taxpayer services.
Advance tax collections during the period came in at Rs 1.56 lakh crore, reflecting a year-on-year growth of 3.87 per cent. This growth was largely driven by a 5.86 per cent rise in corporate advance tax payments. On the other hand, collections from non-corporate taxpayers registered a decline of 2.68 per cent.
While corporate tax collections remained resilient, the Securities Transaction Tax (STT) showed a dip, suggesting a moderating trend in the overall tax collection momentum amid elevated refund disbursals.
In a move to ease taxpayer compliance, the Income Tax Department recently launched the ‘e-Pay Tax’ feature on its official portal. This initiative is aimed at simplifying tax payment processes for users, the Central Board of Direct Taxes (CBDT) noted.
Meanwhile, as part of its reform agenda, the government had proposed a comprehensive revamp of the Income-tax Act, 1961 in the Union Budget presented in July 2024. The revised legislation aims to make tax laws clearer, reduce litigation, and enhance transparency.
Finance Minister Nirmala Sitharaman has confirmed that the new Income Tax Bill will be tabled for discussion in the upcoming monsoon session of Parliament. As announced earlier, individuals earning up to Rs 12 lakh annually will have zero tax liability under the revised regime, following an increase in the rebate limit to Rs 60,000.
The government had also invited suggestions from stakeholders on the draft Income Tax Bill 2025, which is currently being reviewed by a Select Committee for further deliberations.
