Patanjali Civil Services Academy

Direct Tax Collection [Prelims Bits]

Tags: Prelims Current events of national and international importance

Source: The Hindu

Net direct tax collection rose 13% to ₹12.12 lakh crore till 17 September 2026, supported by higher advance-tax payments.
Gross direct tax collection grew 15% to ₹14.32 lakh crore.
Advance tax: ₹5.22 lakh crore; +16.2%
- Corporate advance tax: ₹4.16 lakh crore; +18%
- Non-corporate advance tax: ₹1.06 lakh crore; +9.24%
Refunds: ₹2.2 lakh crore; +29.2%
Net corporate tax: ₹5.56 lakh crore; +19.5%
Non-corporate tax: ₹6.16 lakh crore; +6%
Securities Transactions Tax (STT): ₹40,214 crore; +53%
FY27 budgeted direct-tax collection: ₹26.97 lakh crore, against ₹23.40 lakh crore in FY26.
Securities Transactions Tax (STT): STT is levied on taxable transactions in securities conducted through recognised stock exchanges. STT on equity futures was increased by 150% from 1 April 2026.
Gross direct tax collection − refunds = Net direct tax collection.
Direct taxes include corporate income tax and personal/non-corporate income tax; STT is also included in the reported direct-tax collection.
Central Board of Direct Taxes (CBDT) is the statutory board administering direct-tax laws and functions under the Department of Revenue, Ministry of Finance.

Q1. Consider the following statements regarding Securities Transactions Tax (STT):

STT is associated with specified taxable transactions in securities carried out through recognised stock exchanges.
STT is a direct tax administered within the broader direct-tax framework.
An increase in STT necessarily implies a corresponding increase in corporate income-tax collections.
STT can be collected on securities transactions even when the taxpayer's income-tax liability from other sources remains unchanged.

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 1, 2 and 4 only
(c) 2 and 3 only
(d) 1, 3 and 4 only

Answer: (b)

Explanation:

Statement 1 is Correct: STT is imposed on specified taxable securities transactions undertaken through recognised stock exchanges.
Statement 2 is Correct: STT forms part of the reported direct-tax collection framework.
Statement 3 is Incorrect: STT and corporate income tax are different components of taxation. A change in STT collections does not mechanically cause corporate income-tax collections to change.
Statement 4 is Correct: STT is linked to specified securities transactions; therefore, it can arise independently of whether a taxpayer's income-tax liability from other sources changes.