There has been a strong increase in the treasury of the Modi government in the financial year 2025-26. The rate of direct tax collection has registered an annual increase of 6.33 percent, while the issuance of tax refunds has declined by 16 percent. This performance is going to strengthen the country’s economy and the financial management of the government. Net direct tax collection from April 1 to October 12 has crossed Rs 11.89 lakh crore, whereas last year at the same time this figure was around Rs 11.18 lakh crore.
Detailed analysis of tax collection
A good increase has been seen in corporate tax collection this year. Net corporate tax from April 1 to October 12 reached Rs 5.02 lakh crore, while it was Rs 4.92 lakh crore in the same period till 2024. Non-corporate tax collection stood at Rs 6.56 lakh crore, which was Rs 5.94 lakh crore at the same time last year. Also, Securities Transaction Tax (STT) stood at Rs 30,878 crore showing a slight increase year on year.
The contribution of non-corporate tax to the total tax collection this year was approximately 51.6% and that of corporate tax was 48.4%, which shows a balanced nature of the tax structure.
Refund status, government’s goal and policy
There is a 16% decline in refund processes in 2025-26. Last year, during the same period, a refund of Rs 2,41,749 crore was issued, which has come down to Rs 2,03,107 crore this time. Refunds issued to the corporate sector this time increased to Rs 1,40,741 crore, while refunds issued to non-corporates fell to only Rs 62,359 crore. The government has given priority to investigating irregularities in returns, due to which the process is taking time, but refunds will be issued soon to those whose documents are in order.
The government aims to collect direct taxes of Rs 25.20 lakh crore by the end of this financial year, which is 12.7 percent more than last year. This is a big step in terms of financial strength and indicates stable tax growth.
Economic situation and future strategy
Along with businessmen, individual taxpayers are also seen strengthening the tax base. Strict government scrutiny and digital tax filing system are promoting transparency and compliance. If current trends continue, the government may come close to or even exceed its set target. The strengthening of economic policies and the tax system, despite difficult economic conditions, is strengthening the government’s fiscal position. Tax flow, reduction in refunds and technology have a major contribution in this.