Net direct tax collection rises 16% so far in FY24

India’s direct tax revenue increased 16% this fiscal year to reach ₹ 4.75 trillion, demonstrating continued revenue expansion despite external barriers. Over the past few months, the collection has picked up speed, with net direct tax revenues—net of refunds—growing 15.87% to ₹ 4.75 trillion by July 9, surpassing net collections for the same period previous year. And the figures still show a consistent increase. Gross direct tax revenue, which includes income and corporation tax, increased 14.65% to ₹5.17 trillion. 

According to the Finance Ministry, the preliminary estimate of direct taxes for the current fiscal year 2024 is 26.05 percent of the entire budget estimates. According to updated forecasts, the central board of direct taxes (CBDT) anticipates collecting ₹18.23 trillion in FY24, or 10.5% more than FY23.

Many experts credit better compliance and tax policies for this spike. 

The trend, according to Sumit Singhania, Partner, Delloite India, highlights the advantages of major administrative reforms and the use of digital technology that have occurred over the previous few years. In addition, he expects that the big data environment will keep enhancing the efficiency and quality of tax audits, both of which are essential for encouraging taxpayers to voluntarily comply with the law.

Refunds totaling 42,000 Crore were issued between April 1 and July 9, 2023, the CBDT reports, 2.55 percent more than during the previous fiscal year. The agency predicts that direct taxes will increase by 9.6 percent in FY 24.

The government budgeted ₹14.2 trillion for direct tax receipts. When updated projections were presented, the projection was raised to ₹16.5 trillion. The actual collection, however, came in at ₹16.61 trillion, just exceeding the threshold.

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