According to the Central Board of Direct Taxes (CBDT), net direct tax collection in India has grown by 17% to reach Rs 13.73 lakh crore so far this fiscal year. This amount is equivalent to 83% of the revised target for the full financial year. The increase in direct tax mop-up, which includes personal income tax and corporate taxes, is attributed to the growth in PIT collections.
The gross collection has increased by 22.58% to Rs 16.68 lakh crore. Additionally, refunds worth Rs 2.95 lakh crore were issued between April 1, 2022, and March 10, 2023, which is a 59.44% increase compared to the same period last year. The net direct tax collection after refunds stands at Rs 13.73 lakh crore, which is 16.78% higher than the net collections in the corresponding period of the previous year.
The CBDT mentioned in a statement that this collection is 96.67% of the total budget estimates and 83.19% of the total revised estimates of direct taxes for the financial year 2022-23. After adjusting for refunds, the net growth in Corporate Income Tax (CIT) collections is 13.62%, and in Personal Income Tax (PIT) collections including Securities Transaction Tax (STT), it is 20.06%.
The government had revised its target for direct tax collections for the current fiscal year to Rs 16.50 lakh crore from the budgeted target of Rs 14.80 lakh crore. The growth in direct tax collections so far indicates that the government could meet or exceed its revised target by the end of the financial year.
The increase in PIT collections is due to the economic recovery following the pandemic and the government’s efforts to widen the tax base by encouraging people to file returns. The CBDT’s statement also noted that a 59.44% increase in refunds issued during the current fiscal year compared to the previous year could help boost consumer spending and aid economic growth.
Overall, the growth in direct tax collections is a positive indicator of India’s economic recovery, and the government’s focus on broadening the tax base could help sustain the growth momentum in the long run.