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India's direct tax buoyancy stood at 1.39 in 2024-25, staying above 1 for the third financial year in a row.
The figures surfaced before the Parliamentary Standing Committee on Finance, chaired by Bhartruhari Mahtab, at its 3 September 2026 meeting on direct tax reforms.
Buoyancy above 1 means direct tax collections grew faster than nominal GDP over the same period.
The panel flagged compliance glitches under the new Income-tax Act, 2025 and sought more data from the CBDT on assessees, revenue and pending litigation.
Net direct tax collections had reached Rs 8.11 lakh crore by 10 August 2026, 23.09 per cent higher than a year earlier.
The ratio of the growth rate of tax revenue to the growth rate of nominal GDP. Above 1, revenue is outpacing the economy; below 1, it is lagging. It captures the combined effect of growth, policy changes and better compliance.
Simple Analogy: If your income rises 10% and your savings rise 14%, your savings are buoyant.
The rewritten direct tax statute that came into force on 1 April 2026, replacing the Income-tax Act, 1961. Its stated aim is simplification and easier compliance; the standing committee is examining whether it has delivered that in practice.
The statute that governed direct taxation in India for over six decades until 31 March 2026.
The Act under which the Central Board of Direct Taxes functions as a statutory body, separate from the Central Board of Indirect Taxes and Customs.
Statutory apex body for the administration of direct taxes, functioning under the Department of Revenue in the Ministry of Finance
Parliamentary committee that scrutinises the demands for grants, bills and policy of the Finance Ministry and allied departments; it examines direct tax reform and revenue performance
GS Paper III > Indian Economy > Government budgeting, mobilisation of resources and taxation
General Awareness > Fiscal policy, taxation and financial institutions
Which of the following is an example of a "Direct Tax"?
Answer: Income Tax
Which of the following is a direct tax in India?
Answer: Income Tax
Ratio of the growth rate of tax revenue to the growth rate of nominal GDP; above 1 means revenue is growing faster than the economy.
Growth in tax revenue attributable to a widening tax base alone, holding the tax structure constant — buoyancy without the effect of policy changes.
A tax levied on income or profits and borne by the person on whom it is imposed, such as income tax, corporate tax and securities transaction tax.