Net direct tax collections rise over 9% to ₹10.82 lakh crore in H1FY26; refunds fall 23.8% to ₹1.6 lakh crore

The direct tax collections recorded a notable increase in the first half of the financial year, until mid-September, as government data shows.

As of September 17, 2025, the net direct collection stood at ₹10.82 lakh crore, representing a 9.18% increase compared to the ₹9.91 lakh crore collected during the previous year.

According to the CBDT data, gross direct tax collections during the period reached ₹12.43 lakh crore, up 3.39% from ₹12.02 lakh crore in the same period last year.

Corporate tax (CT) collections amounted to ₹5.9 lakh crore, while non-corporate tax (NCT)—which includes taxes paid by individuals, HUFs, firms, AOPs, BOIs, local authorities, and artificial juridical persons—stood at ₹6.2 lakh crore.

A significant reduction was observed in refunds, which decreased by 23.87% to ₹1.6 lakh crore from ₹2.1 lakh crore in the previous year. According to the sources, the lower refunds are due to more timely and accurate tax filings.

Vivek Jalan, Partner, Tax Connect Advisory Services LLP, said, "The direct tax collections till September 17, 2025, seem to be in alignment with the policy changes by MoF and procedural changes by CBDT in the recent past. With the massive reduction in individual income taxes for FY 25-26, the non-corporate advance taxes have declined by around 7%. Also, on account of very strict monitoring of deductions in the Income Tax Returns (ITRs) this year, driven by heightened disclosures, the refunds are being closely scrutinised before release, and hence the non-corporate refunds have almost dropped to one-third YoY.

"However, with the massive GST reductions from September 22, 2025 and the estimated resultant GDP growth of Rs 2 lakh crore, the corporate tax collections are expected to uptick substantially in the period October 25 to March 26," added Jalan.

According to CBDT data, Securities Transaction Tax (STT) collections were marginally higher and stood at ₹26,305 crore, compared to ₹26,154 crore a year ago. Other taxes (OT) contributed ₹297 crore to the total collections.