Daijiworld Media Network - New Delhi

New Delhi, Jul 14: The time taken to issue income tax refunds in India has shrunk dramatically — from 93 days in 2013 to just 17 days in 2024 — thanks to a digital transformation of the tax administration system.

This sharp reduction — nearly 81% faster — is the result of automated refund processing, pre-filled tax returns, real-time TDS reconciliation, and an improved online grievance redressal system, according to data from the Principal Chief Controller of Accounts and the Central Board of Direct Taxes (CBDT).

Alongside faster processing, the volume and value of refunds have also surged. Refund disbursals have jumped 474% over the past decade — from Rs 83,008 crore in FY14 to Rs 4,76,743 crore in FY25. As a share of gross tax collections, refunds have risen from 11.5% to 17.6% during the same period.

Meanwhile, India’s taxpayer base has more than doubled, with income tax return filings climbing from 3.8 crore in 2013 to 8.89 crore in 2024, reflecting better compliance and formalisation of the economy.

Gross direct tax collections have also seen phenomenal growth, rising 274% from Rs 7.21 lakh crore in FY14 to Rs 27.02 lakh crore in FY25, showcasing rising income levels and expanding economic activity.

This tax efficiency comes as part of a broader economic success story. India’s GDP has tripled in the last decade — from Rs 106.57 lakh crore to Rs 331.03 lakh crore — with a strong 6.5% growth rate in FY25.

Forecasts remain bullish. The RBI expects this momentum to continue into FY26, while the United Nations projects 6.3% growth this year and 6.4% next year. The Confederation of Indian Industry (CII) is even more optimistic, estimating growth between 6.4% and 6.7%.

The growth is underpinned by rising rural demand, urban consumption, and a pickup in private investment. Government capital expenditure, particularly on infrastructure, remains robust, while favourable credit conditions are enabling businesses and households to invest confidently in the future.