Income Tax Department on Friday reported surge in net direct tax collection by over 45 per cent during April 1 to June 16. It has also said the latest number on advance tax topped ?1 lakh crore, registering 33 per cent growth.
The Department said that the net collection are at ?3.39 lakh crore compared to ? 2.33 lakh crore, a groth of 45 per cent. It is 171 per cent higher than the FY21 collections (?1.25 lakh crore) and 103 per cent over FY20 (?1.67 lakh crore).
“Net Direct Tax collection for the FY23 continue to grow at a robust pace further fortifying the economic revival,” the Department said in a statement.
The net direct tax means the gross collection minus the refund. The net collection of around ?3.39 lakh crore includes Corporation Tax (CIT) at ? 1.71 lakh crore (net of refund) and Personal Income Tax (PIT), including Security Transaction Tax (STT) at ?1,68 lakh crore (net of refund).
The gross direct tax collection for FY23 stood at around ?3.7 lakh crore compared to ? 2.64 lakh crore in the corresponding period of the preceding year, representing an increase of almost 40 per cent.
Advance tax mop-up
The Advance Tax collections for the first quarter of the FY23 stood at around ?1.01 lakh crore against ?75,783 crore for the corresponding period of the preceding financial year, showing a growth of 33 per cent. This comprises CIT at ? 78,842 crore and PIT at ? 22,175 crore. “This amount is expected to increase as further information is received from Banks,” the department said.
The TDS collection for current fiscal stood at ? 2.29 lakh crore against ? 1.57 lakh crore for the corresponding period of the immediately preceding financial year, a growth of nearly 46 per cent per cent.
Commenting on the latest number, Om Rajpurohit, Director (Corporate & International Tax) with AMRG & Associates, said that following the month-on-month increase in GST collection, the exponential surge in tax collections validates the economic resuscitation. Surprisingly, despite recent decreases in corporate tax rates, corporate tax collection has increased dramatically, indicating a massive increase in corporate investment driven by various PLI schemes & incentives.
“Furthermore, the implementation of new TDS measures to broaden the tax base has clearly demonstrated its impact, as evidenced by a significant increase in TDS collection, which accounts for a significant portion of total tax collection,” he said.
Amit Maheshwari, Tax Partner with AKM Global said that the net growth in the overall direct tax collections by 45 per cent as per the press release issued by CBDT is a testimony to the post-pandemic recovery since the economy was hit in both the previous years by COVID. “The rise in advance taxes by 33 per cent versus last year is a positive indication of the revival of several critical sectors contributing directly to the economic development. This also points to robust tax collections in the current year as well,” he said.
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