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The Central Board of Direct Taxes (CBDT) on Sunday said that gross Direct Tax collection rose by around 24 per cent between April 1 and October 8, 2022.
This includes two instalments of the Advance Tax along with Self-assessment Tax, among others.
Direct Taxes include Personal Income Tax (PIT), which in turn includes the Securities Transaction Tax (STT), and Corporate Income Tax (CIT), contributing nearly half of the total tax collection.
“Direct Tax collection up to October 8, 2022, show that gross collections are at ₹8.98-lakh crore which is 23.8 per cent higher than the gross collections for the corresponding period of last year,” a statement issued by the CBDT said.
Further, the Net Direct Tax collection (net of refunds) stands at ₹7.45-lakh crore which is 16.3 per cent higher than the net collection for last year’s corresponding period. This collection is 52.46 per cent of the total budget estimates of direct taxes for FY2022-23.
Growth rate
In terms of gross revenue collections, the growth rate for CIT is 16.73 per cent while that for PIT (including STT) is 32.30 per cent.
After the adjustment of refunds, the net growth in CIT collections is 16.29 per cent and PIT collections is 17.35 per cent, and for PTI (including STT) is 16.25 per cent.
Refunds amounting to ₹1.53-lakh crore were issued during April 1 to October 8, which are 81 per cent higher than refunds issued during the same period in the preceding year.
Expert’s take
Commenting on the latest number, Rohinton Sidhwa, Partner with Deloitte India said with inflation reportedly running between 6-7 per cent, it is imperative that tax collections show a healthy growth above the inflation rate.
Sidhwa said, “Strong economic growth coupled with better reporting seems to be supporting the collection figures. While collections remain strong, the same also needs to be supported by corporate investment cycles reviving post-Covid numbers.”
Govt’s aim
The Budget has set the target of reaching ₹14.20-lakh crore from Direct Taxes and ₹13.37-lakh from Indirect Taxes for FY23. With the current pace, the Finance Ministry officials are hopeful of a much better collection.
Last month, in an interview with BusinessLine, Revenue Secretary Tarun Bajaj said he expects both Direct and Indirect Tax collections to exceed budget estimates.
“I can say without any doubt at this stage that we will exceed the budget estimates. In Direct Taxes, we may exceed by a big margin as compared to Indirect Taxes because, in Indirect Taxes, we also reduced the excise duty,” he said.
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