India’s net direct tax collections increased 18.2% in April-December 2017 from a year ago, with advance tax payments in December adding substantially to the kitty'.
Gross direct tax collections (before adjusting for refunds) increased 12.6% to Rs. 7.68 lakh crore.
Refunds amounting to Rs. 1.12 lakh crore were issued during the first nine months of the current fiscal year, yielding net direct tax collection of Rs. 6.56 lakh crore.
As much as Rs. 3.18 lakh crore has been received as advance tax up to December 2017, reflecting a growth of 12.7% over the year-ago period, data released by the government showed. Corporate advance tax payment, an indicator of corporate performance, was
up 10.9% in this period compared with 8.1% rise in the April-September period.
The rise in the case of advance personal income tax was 21.6%.
This suggests a better corporate performance in the October-December quarter, though experts said detailed numbers are needed to ascertain any recovery.
“The sharp improvement in growth of net direct tax collections in the month of December 2017 benefits from both a healthy pickup in gross collections and a significant contraction in refunds,” said Aditi Nayar, principal economist at rating agency ICRA.
“Therefore, it may be too early to peg this improvement as sustainable,” she said.
The earnings could have also got a boost from the low base of last year as December quarter earnings had been hit by demonetisation at the time.
Tax experts said the buoyancy could also be due to efforts of tax officials to mop up revenues ahead of the union budget to be presented on February 1.
“In December 2017, the CBDT (Central Board of Direct Taxes) had issued instructions to step up efforts in tax collection by pursuing tax arrears and expediting even non-time barring cases where there was a possibility of raising tax demand,” said Shefali
Goradia, partner at Deloitte India. “Increase in the tax collection may be in response to this initiative.”
The net collections represent 67% of the total budget estimate of Rs. 9.8 lakh crore for direct taxes in 2017 -18.
Direct taxes comprise income tax paid by individuals, corporate tax and wealth tax. The government had last fiscal exceeded the direct tax collection target set in the budget. It had collected more than Rs. 8.49 lakh crore while the budget estimate was Rs.
8.47 lakh crore. - www.economictimes.indiatimes.com [10-01-2018]