The net direct tax collection also includes corporate income tax (CIT) collection at Rs 74,356 crore and Personal Income Tax, including Security Transaction Tax (STT) at over Rs 1.11 lakh crore.
In signs of economy reflating after a devastating second wave of Covid-19, net income and corporate tax collections so far this fiscal doubled to over Rs 1.85 lakh crore buoyed by advance tax and TDS payments.
Mop up of net direct tax (which is arrived at after deducting refunds from gross collection) between April 1-June 15 was at Rs 1,85,871 crore, a 100.4 per cent growth over Rs 92,762 crore collected in the same period last fiscal, the Central Board of Direct Taxes (CBDT) said in a statement.
Refunds amounting to Rs 30,731 crore have been issued in the current fiscal.
The gross direct tax collection so far this fiscal stands at over Rs 2.16 lakh crore, a 57 per cent growth over Rs 1.37 lakh crore mopped up in the corresponding period of the preceding year.
While Rs 28,780 crore was collected by way of Advance Tax, Tax Deducted at Source (TDS) was over Rs 1.56 lakh crore. Self-Assessment Tax stands at Rs 15,343 crore and Regular Assessment Tax at Rs 14,079 crore.
This takes the gross CIT and PIT mop up to Rs 96,923 crore and Rs 1.19 lakh crore, respectively. After deducting refunds, net CIT and PIT collection during April 1-June 15 was Rs 74,356 crore and over Rs 1.11 lakh crore respectively.
“Despite extremely challenging initial months of the new fiscal , the Advance Tax collections for the first quarter of the F.Y. 2021-22 stand at Rs 28,780 crore against Advance Tax collections of Rs 11,714 crore for the corresponding period of the immediately preceding Financial Year, showing a growth of approximately 146 per cent,” the CBDT said.
Experts, however, said that not much should be read into the growth in tax collection numbers as in the comparative timeline in last fiscal there was a nationwide lockdown as against a state-specific lockdown in the current fiscal.
ICRA Chief Economist Aditi Nayar said the jump in the direct tax collections in the first quarter of the current fiscal reflects healthy exports and a continuation of various industrial and construction activities, given the lower stringency of the staggered regional lockdowns in 2021 versus the nationwide lockdown in 2020. “This supports our expectation that GDP will record a double-digit expansion in Q1 FY2022,” she said.
AMRG & Associates Senior Partner Rajat Mohan said, “Comparison of tax collections to the previous financial year, would not give a true picture as the said period belongs to the lockdown era, where the future was highly uncertain, economy shrank in double digits, and compliance dates were practically extended”.
Nangia Andersen LLP Partner Sandeep Jhunjhunwala said the first quarter of the last fiscal had seen the onset of the pandemic taking businesses by a sudden off-guard causing a higher disruption as compared to the corresponding period of the current financial year.
“With more than one year into the pandemic, businesses have learnt to grease the squeaky wheel and have emerged more mature and experienced. Revived businesses, observance of timely compliances coupled with the culmination of the income tax amnesty scheme could all be collective factors leading to the spike in direct tax and advance tax collections,” he said.
The upward graph on tax collections may be suggestive of a course correction of the Indian financial ecosystem, to some extent, assuaging the frayed nerves of the Government caused by outlays on relief measures for the pandemic, Jhunjhunwala added.
Deloitte India Partner Neeru Ahuja said the primary reason for the significant increase in direct tax collection can be attributed to the success of government’s Vivad se Vishwas scheme.
“Taxpayers have taken advantage of the Vivad se Vishwas (VSV) scheme and have settled their old disputes and litigations with the income tax department along with depositing their tax dues. This seems to be the main reason we are noticing a boost in the direct tax collections,” Ahuja added.
The extended deadline for making payments under the VSV scheme, which offers taxpayers to settle tax dues which are under litigation, is June 30.
In the last fiscal, which ended March 2021, the gross direct tax (CIT and PIT) collection was Rs 9.45 lakh crore, better than Rs 9.05 lakh crore pegged in the Budget Revised Estimates.