Net direct tax collections rose 13% this year, driven by a jump in corporate tax. The surprise is securities transaction tax, up 52%. That number may complicate the government’s new openness to a debate on market taxes.
The government’s tax coffers are filling faster this year, and the biggest boost is coming from companies.
Net direct tax collections rose 13.21% to ₹13.38 lakh crore between 1 April and 14 October, data from the Central Board of Direct Taxes showed on Thursday. A year earlier, the figure was ₹11.82 lakh crore. Gross collections, before refunds, rose 14.89% to ₹16.03 lakh crore.
Corporate tax leads
The standout was corporate tax. Net collections from companies rose 20.58% to about ₹5.99 lakh crore. That is a healthy sign. Corporate tax broadly tracks profits, and strong collections suggest companies have been earning well, even as share prices have fallen.
Non-corporate tax, which mostly comprises personal income tax paid by individuals, firms and Hindu undivided families, grew much more slowly, by 5.83% to about ₹6.92 lakh crore. Part of the reason is refunds.
Refunds move faster
Refunds jumped 24.22% to ₹2.65 lakh crore, up from ₹2.13 lakh crore a year earlier. Corporate refunds were about ₹1.54 lakh crore and non-corporate refunds about ₹1.11 lakh crore.
Faster refunds reduce net collections in the short term but are good news for taxpayers. They mean the income tax department is processing claims more quickly and returning excess payments sooner, rather than holding on to money that belongs to individuals and businesses. For many households, a timely refund matters more than any headline collection number.
The STT surprise
The most interesting figure is securities transaction tax, the small levy charged on every share and derivatives trade. STT collections surged 51.6% to ₹46,840 crore.
That is remarkable in a year when the stock market has fallen. It reflects two things. Trading volumes, especially in derivatives, have remained very high even as prices dropped. And earlier increases in STT rates on futures and options have lifted the amount collected per trade.
The timing is notable. Just two days ago, Finance Minister Nirmala Sitharaman said the government would listen to market participants, in India and abroad, on how securities are taxed, as preparations for the 2027 Budget begin. Investors read that as a hint that long-term capital gains tax or STT could be eased, and the Sensex jumped more than 1,100 points.
The new numbers show what is at stake. STT now brings in close to ₹47,000 crore in barely six and a half months. Any cut would cost the government real money at a time when it also needs funds for infrastructure, defence and welfare. The finance minister did not commit to any change, and these figures suggest the case for cutting will face tough scrutiny inside the finance ministry.
The fiscal picture
Overall, the collections put the government in a comfortable position. Strong corporate tax receipts give it room to manage higher spending on fuel subsidies, if oil stays expensive, without widening the deficit sharply. Combined with strong GST collections and asset sales such as the IDBI Bank stake, the fiscal picture looks healthier than many expected at the start of the year.
The second half of the year will matter more. Advance tax payments in December and March often decide whether annual targets are met. If corporate profits hold up despite rising costs, collections should stay strong. If margins come under pressure, as early results from companies like Nestlé suggest they might, growth could slow.
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