New Delhi, Jan 7 || India's tax collections could surge in FY27, with gross tax buoyancy rising to 1.1 from a projected 0.64 in FY26, a report said on Wednesday.
The report from HDFC Bank said that nominal GDP growth is expected at about 10.1 per cent in FY27 after an estimated 8.5 per cent in FY26. It said that capital expenditure is expected to grow by 10.5 per cent to about Rs 11.5–12 lakh crore while revenue expenditure may rise 9.5 per cent to Rs 41.9 lakh crore.
The government's fiscal deficit target of 4.4 per cent for FY26 is likely to be achieved, with the deficit pegged at about Rs 15.79 lakh crore versus the budget estimate of Rs 15.69 lakh crore, the report said.
It added that fiscal consolidation will continue in the upcoming Union Budget 2026-27, with a target of 4.2 per cent for FY27 compared to 4.4 per cent in FY26. The report projected debt/GDP ratio of 55.1 per cent compared to 56.1 per cent in FY26 (BE).
Higher government bond supply will keep demand/supply mismatches, creating scope for open market operation (OMO) purchases of about Rs 4–Rs 4.5 lakh crore in FY27 and keeping the 10‑year yield elevated in a 6.5–6.7 per cent range.