Goldman Sachs expects the Indian Government's net tax revenue to increase by 20 percent in the current fiscal, higher than the budget estimate of 17 per cent, due to the robust direct tax collection, despite slowdown in indirect tax figures.

"We expect revenue growth to slow a notch in FY 2009 from FY 2008, and yet higher than budgeted," Goldman Sachs said in its research report.

Direct tax collections grew by a whopping 38 percent to touch Rs 3,14,468 crore in 2007-08 and indirect tax collections also surpassed the revised estimates of Rs 2,79,000 crore.

The report, Asia Economics Flash, however, said tax revenue growth might slow down further next fiscal due to weakening economic activity.

"We expect net tax revenue growth to slow from 20 per cent (YoY) in the current fiscal to 16 percent in FY'10," the report said.

This fiscal indirect tax collections were targeted to move up to around Rs 3,20,000 crore and direct tax collections to around Rs 3,94,000 crore.

Goldman Sachs said continued buoyancy in direct taxes (corporate and income) will offset a slowdown in excise and customs duties.

The direct taxes have gone up by 32.54 percent during the first half of the current fiscal, while customs and excise duty grew by just 9.8 percent to Rs 19,421 crore in September.

In fact, excise duty collection declined by 3.8 percent to Rs 9,800 crore in September from Rs 10,186 crore in the same month last year.