Direct Tax Collections Climb 13.57 Per Cent In FY25, Narrowly Miss Revised Target

Net direct tax collections for the financial year 2024-25 witnessed a notable growth of 13.57 per cent, touching Rs 22.26 lakh crore. However, the figure narrowly fell short of the revised target of Rs 22.37 lakh crore, official data released on Friday revealed. The shortfall was attributed to the issuance of the highest-ever amount of tax refunds during the year.

Initially, the government's budget for July 2024 had set a target of Rs 22,07,000 crore for direct taxes. This target was later revised to Rs 22,37,000 crore in the budget presented in February 2025, reported PTI.

Direct taxes comprise collections from corporate tax, securities transaction tax (STT), and non-corporate taxes, the latter covering taxes paid by individuals, firms, Hindu Undivided Families (HUFs), local authorities, and artificial juridical persons.

Highest-Ever Refunds Impact Net Collections

According to provisional figures, the gross direct tax collection for 2024-25 stood at Rs 27.02 lakh crore, a 15.59 per cent jump from Rs 23.37 lakh crore collected in the previous financial year. After accounting for refunds, net direct tax collections totalled Rs 22.26 lakh crore, marking an increase from Rs 19.60 lakh crore recorded in 2023-24.

The STT component alone saw collections rise to Rs 53,296 crore in 2024-25, compared to Rs 34,192 crore in the preceding year. Officials highlighted that despite issuing record refunds amounting to Rs 4,76,743 crore, a 26.04 per cent increase from Rs 3,78,255 crore refunded in 2023-24, the department still managed to meet 100.78 per cent of the July 2024 budget estimate and 99.51 per cent of the revised target.

An official explained, "The gross direct tax collection has exceeded the budget target of Rs 22.37 lakh crore and the income tax department was able to achieve these high numbers even after issuing a record Rs 4.76 lakh crore in refunds." The official added, "This is due to the commitment that the department has made to the taxpayers that we stand by them and their rightful claims will be honoured in a transparent and fair manner."

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Corporate and Non-Corporate Collections See Steady Growth

Breaking down the collections further, the data showed that provisional net corporate tax collections for 2024-25 amounted to Rs 9,86,719 crore, representing an 8.30 per cent growth over the previous year. On a gross basis, corporate tax collections stood at Rs 12,72,516 crore, reflecting a 12.41 per cent increase year-on-year.

In the non-corporate segment, net collections rose to Rs 11,82,875 crore during 2024-25, achieving a 17 per cent growth over 2023-24. The tax buoyancy, a measure comparing direct tax growth to GDP growth, was recorded at 1.57 for 2024-25, marginally higher than 1.54 seen during the previous fiscal.

Officials noted that these figures are provisional and may undergo further upward revisions as the final stage of reconciliation for FY25 is completed.

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