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New Delhi: India’s direct tax collections surged to Rs 15.60 lakh crore till February 10 in the current financial year, registering a year-on-year growth of 20.25%, led by a strong jump in personal income tax, official data showed on Sunday.
The net tax collection till February 10 is 80.23% of the total revised estimate for the full financial year. Better than expected economic growth and increased compliance have boosted income tax collections. Net collections from personal income tax surged 26.91% year-on-year till February 10 in the current financial year while net revenue from corporate income tax increased by 13.57% during this period.
Revenue collection from direct taxes in 2023-24 is set to surpass the budgetary estimate by Rs 1.22 lakh crore. In the interim budget presented on February 1, Finance Minister Nirmala Sitharaman increased the direct tax revenue target for the current financial year to Rs 19.45 lakh crore from the original budgetary estimate of Rs 18.23 lakh crore.
There has been a consistent surge in mop-up from direct taxes in recent years. “Over the last ten years, the direct tax collections have more than trebled and the return filers swelled to 2.4 times,” Sitharaman said in her budget speech earlier this month. In the first nine months of the current financial year 8.18 crore income tax returns (ITRs) were filed, which is 9% more than a total of 7.51 crore ITRs filed during the full year 2022-23.
In 2021-22, net direct tax collection stood at Rs 14.08 lakh crore. It surged to Rs 16.61 lakh crore in 2022-23 and is estimated to reach Rs 19.45 lakh crore in the current financial year. The government is targeting Rs 21.99 lakh crore revenue from direct taxes in the financial year beginning April 1, 2024.
As per data released by the Central Board of Direct Taxes (CBDT), gross collections from direct taxes up to February 10 stood at Rs 18.38 lakh crore, which is 17.30% higher than the corresponding period of last year. Gross collections from personal income tax surged by 25.67% while gross mop-up from corporate income tax rose by 9.16% during this period.
Refunds amounting to Rs 2.77 lakh crore have been issued during April 1, 2023 to February 10, 2024. After adjustment of refunds, the net growth in corporate income tax collections stood at 13.57% and that in personal income tax collections at 26.91%. Personal income tax when clubbed with securities transaction tax posted a growth of 27.17% year-on-year in net collections, CBDT data showed.
Not just direct taxes, there has been buoyancy in indirect tax collections as well. Revenue collection from Goods and Services Tax (GST) soared to Rs 16.69 lakh crore in the first 10 months of the current financial year, which is 11.6% higher when compared with the collection during the same period last year.
Robust tax revenues have helped in keeping the fiscal deficit under check despite substantial overshooting in expenditure. Fiscal deficit, or the gap between the central government’s income and spending, is estimated to come down to 5.8% of GDP in the year ending March 31, 2024 from the budgetary estimate of 5.9%.
The centre’s fiscal deficit stood at Rs 9.82 lakh crore in April-December period, which is 55% of the full-year budgetary target of Rs 17.87 lakh crore, as per the latest data released by the Controller General of Accounts.
For 2024-25 the central government targets to increase revenue from taxes to Rs 38.31 lakh crore, 11.45% higher than the revised estimate of Rs 34.37 lakh crore for the current fiscal. The target for 2024-25 includes Rs 21.99 lakh crore from direct taxes and Rs 16.31 lakh crore from indirect taxes.