ADVERTISEMENT

Government Collects Rs 6.95 Lakh Crore In Direct Taxes In April-January

Net direct tax collections in April to January rose 19.3 percent on a yearly basis to Rs 6.95 lakh crore.

Tax forms and a calculator. (Photographer: Luke Sharrett/Bloomberg)
Tax forms and a calculator. (Photographer: Luke Sharrett/Bloomberg)

The government reached about 70 percent of its increased direct tax target in the first 10 months of the financial year, putting it on track to partly make up for an expected shortfall in indirect taxes.

Net direct tax collections in April to January rose 19.3 percent on a yearly basis to Rs 6.95 lakh crore, the Central Board of Direct Taxes said in a statement. That’s about 69.2 percent of the revised estimate. Corporate tax collections rose 19.2 percent and the personal income tax mop-up grew 18.6 percent, the CBDT statement said.

Growth in the economy led to an increase in corporate income tax while the rise in personal income tax can be attributed to various steps taken by the income tax department and its crackdown on tax evaders, said Sanjay Kumar, senior director at Deloitte India.

If the current trend in direct tax collection continues, the government’s fiscal picture would be better, since about 25 percent of direct tax revenue is collected in the last month of the financial year.
Sanjay Kumar, Senior Director, Deloitte India

In Union Budget 2018-19, the government revised the target for 2017-18 upwards from the budgeted Rs 9.8 lakh crore to Rs 10.05 lakh crore. If met, the target will help it compensate for lower indirect tax collections after the rollout of Goods and Services Tax. It has already breached the fiscal deficit target for the year.

Gross direct tax collections, before adjusting for refunds, rose 13.3 percent to Rs 8.21 lakh crore in April-January 2018. Refunds amounting to Rs 1.26 lakh crore were issued during the period.