Direct Tax Share in GDP Reaches 24-Year High at 6.64% in FY24

India’s direct tax collections reached a 24-year high of 6.64% of GDP in FY24. The Central Board of Direct Taxes (CBDT) reported a 17.82% increase in collections, significantly outpacing the nominal GDP growth of 8.42%. Direct tax buoyancy improved to 2.12, indicating higher responsiveness of tax collections to GDP growth. Total direct tax collections amounted to Rs 19.6 trillion, with personal income tax collections rising by 25.4% to Rs 10.45 trillion, surpassing corporation tax collections for the second consecutive year. Maharashtra led state-wise contributions with Rs 7.61 trillion. The number of Income-Tax Returns (ITRs) filed grew by 10.7%, totaling 86.1 million. The administrative cost of collecting direct taxes declined to a 23-year low of 0.44%. This robust performance reflects the efficiency of the tax administration and a growing taxpayer base, contributing significantly to India’s fiscal health.