Gross direct tax collections up by 25.90%

India’s gross direct tax collections for FY23 have increased by 25.90% reaching INR 13.6 trillion compared to last year’s 10.8 trillion, according to a report from the Income Tax Department of India. 

According to the report, the gross collection includes Corporation Tax (CIT) at INR 7.2 trillion and Personal Income Tax at INR 6.3 trillion. The economy rebounded from the pandemic, resulting in a rise in earnings for both companies and individuals. 

On the other hand, the net tax collection for FY23 rose by 19.81% to INR 11.3 trillion, compared to last year’s INR 9.4 trillion which is about 80% of the full-year Budget target. Media reports said that the net direct tax collection includes Corporation Tax (CIT) at INR 6.06 trillion (net of refund) and personal income Tax (PIT) including Securities Transaction Tax (STT) at INR 5.26 trillion (net of refund). Till December 17, 2022, refunds amounting to INR 2.28 trillion have been issued, registering a 68% growth from the previous year.

As per the report, the Budget had estimated direct tax collection of INR 14.20 trillion for FY23, compared to last year’s INR 14.10 trillion. 

Cumulative advance tax collections for the first, second, and third quarters of FY23 stood at INR 5.21 trillion against INR 4.62 trillion for FY22, showing a growth of 12.83%. The advance tax collection includes CIT at INR 3.97 trillion and PIT at INR 1.23 trillion.

About 96.5% of the duly verified ITRs have been processed till December 17 FY23, which has resulted in the faster issue of refunds with almost a 109% increase in the number of refunds in 2022 from the previous year. 

As new policy regulations emerge, and initiatives to boost economic activity function effectively, the government can further surpass its tax revenue targets in the future.

Source: Mint