Tax Refund: Increase in tax refund, decrease in collection, why are these figures troubling the government?

The government seems to be worried about direct tax collection. There is a reason for it. Due to the increase in tax refunds, the tax received by the government has decreased. If we look at the figures, there has been a decrease of about 4 percent in net direct tax collection in the current financial year so far. The special thing is that there has been a decrease in tax collection before refund, which is quite surprising. This means that the government's income from direct taxes has decreased. The worrying thing is whether the government's target of more than Rs 25 lakh crore from tax collection will be achieved in the current financial year or not. Let us also tell you what kind of figures have been received from the government…

How much was the net collection

According to the government data released on Tuesday, net direct tax collection has decreased by 3.95 percent to Rs 6.64 lakh crore in the current financial year so far. The reason for the decrease in tax collection is the high refund. Direct tax includes tax on income of companies, individuals, professionals, and other entities. Net company tax collection stood at around Rs 2.29 lakh crore, while non-company tax (which includes individuals, Hindu Undivided Families, and companies) collection stood at Rs 4.12 lakh crore. According to the data, Security Transaction Tax (STT) collection has been seen at Rs 22,362 crore between April 1 and August 11.

How much collection before refund

Net collection declined by 3.95 percent to about Rs 6.64 lakh crore. It was Rs 6.91 lakh crore in the same period of the last financial year (2024-25). The refund issued so far in the current financial year increased by 10 percent to Rs 1.35 lakh crore. Between April 1 and August 11, gross collection (before refunds) fell by 1.87 per cent to Rs 7.99 lakh crore, from Rs 8.14 lakh crore in the same period a year ago. The government has estimated direct tax collection to be Rs 25.20 lakh crore in the current financial year (2025-26), which is 12.7 per cent higher on an annual basis. The government aims to collect Rs 78,000 crore from STT in the financial year 2025-26.

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