The income tax department has processed refunds worth Rs 1.46 lakh crore till November 28, up 23% compared with the same period a year ago, a tax official said.
Direct tax collections, net of refunds, for the April-November period grew just 1.6% against the required rate of 17.4% to achieve the budget estimate of Rs 13.35 lakh crore for the current fiscal.
In the first eight months of the fiscal, the government collected Rs 5.56 lakh crore in direct taxes compared with Rs 5.48 lakh crore in the same period in FY19, Anurag Thakur, minister of state for finance, said in a reply in Parliament on Tuesday.
The tepid growth is partly due to the economic slowdown and also on account of the deep corporate tax cuts announced by the government in September, which came into effect from the start of current fiscal. The headline corporate tax rate was slashed to 22% from 30% earlier for regular firms while it was cut to 15% from 25% for new manufacturing units.
Sources said another reason for low growth is the release of higher quantum of refunds in the first eight months of the current fiscal against the same period last year. The income tax department has processed refunds worth Rs 1.46 lakh crore till November 28, up 23% compared with the same period a year ago, a tax official said.
The department also expedited more refunds during the period under review with 68% of them being issued within 30 days from e-verification of the IT returns. In the same period last year, 57% of total refunds had been issued within 30 days.
“…100% of all 2.28 crore refunds issued by Centralised Processing Center (CPC) during April-November has been directly credited to the taxpayer bank account by electronic clearing service (ECS), eliminating paper cheque and ensuring faster, accurate and safer credit,” another official said. The pending refunds till November 29 amounted to just over 20 lakh or about 9% of total refunds. These are being currently processed, the officials said. At the same period last year, over 50% more refunds were pending.