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Informist, Monday, Jun. 1, 2026

 

--Govt FY26 gross tax revenue INR 40.243 tln vs INR 37.964 tln year ago 

--Govt: FY26 state tax devolution INR 13.930 tln vs INR 12.869 tln yr ago 

 

NEW DELHI – The central government collected INR 40.243 trillion as taxes in the year ended March, INR 534 billion lower than the revised Budget estimate, data from the Controller General of Accounts showed. The Budget had projected the revised tax collection target for 2025-26 (Apr-Mar) at INR 40.778 trillion. The gross tax collection in FY26 was 6% higher than the INR 37.964 trillion collected the previous year.

 

The lower gross tax collection was primarily on account of a shortfall in income tax collections during the fiscal, the first year of Finance Minister Nirmala Sitharaman's direct tax bonanza announced in the FY26 Budget. She had hiked the tax rebate limit to INR 1.2 million, effectively meaning that individuals with income of up to INR 1.2 million per annum would be exempted from paying any income tax. The move was aimed at increasing disposable income in the hands of taxpayers to spur demand. The changes in income tax would result in revenue loss of INR 1 trillion per annum, Sitharaman had said at the time of announcing the tax bonanza. 

 

Income tax mop-up in FY26 was broadly flat on year at INR 11.834 trillion in FY26, INR 1.286 trillion lower than the revised Budget estimate. Corporate tax collections also missed the revised Budget aim, although by a limited margin. The government collected INR 10.991 trillion as corporate tax in FY26, up 11.4% on year.

 

Goods and services tax, customs and excise duty collections beat the revised Budget estimates in FY26, helping the government bridge the wide shortfall caused by lower income tax collections. Central GST collections grew 6.4% on year, while customs and excise duties grew 13.4% and 3.9%, respectively. 

 

On a net basis, the government collected taxes to the tune of INR 26.233 trillion in FY26, against the revised Budget estimate of INR 26.747 trillion. During FY26, the government's devolution to states was INR 13.930 trillion, up 8.2% on year. With this, the Centre devolved 100% of the full amount to be shared with states in FY26.  

 

The details for the central government's tax collections for FY26 are as follows (in billion INR):

 

	FY26	FY25	Year-on-year % change
Corporation Tax	10,991.30	9,867.67	11.4
Income Tax	11,833.97	11,829.65	0.0
Securities Transaction Tax	575.22	521.97	10.2
Other Receipts	0.1	0.09	11.1
Central GST	9,675.54	9,089.54	6.4
Union territory GST	71.51	53.95	32.5
Integrated GST	(-)25.36	(-)324.83	--
GST compensation cess	1,003.18	1,505.70	(-)33.4
Customs	2,643.94	2,332.01	13.4
Excise duty	3,418.51	3,002.53	13.9
Service Tax	(-)17.74	(-)0.15	--
Other taxes	73.3	85.69	(-)14.5
Total	40,243.47	37,963.82	6.0

 

End

 

Reported by Priyasmita Dutta

Edited by Deepshikha Bhardwaj

 

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