India’s direct tax collection has soared to a remarkable high, crossing the ₹18.9 trillion mark (about $227 billion), showcasing a robust 20 percent increase from the previous year. This impressive achievement, as highlighted by the Central Board of Direct Taxes (CBDT), is attributed to the country’s buoyant economy and enhanced compliance measures.
Breaking down the figures, the net direct tax collection saw a 19.88 percent rise, reaching over ₹18.9 trillion up to March 17. The collection is comprised of Corporation Tax (CIT) at ₹9.14 trillion ($110 billion) and Personal Income Tax (PIT), including Securities Transaction Tax (STT), totaling ₹9.72 trillion ($117 billion). Additionally, the fiscal year has seen tax refunds amounting to approximately ₹3.37 trillion ($40 billion).
Finance Minister Nirmala Sitharaman had set a revised direct tax collection target of ₹19.45 trillion ($234 billion) in the FY25 budget announcement. The current figures not only reflect a healthy fiscal outlook but also signal the economy’s resilience, closely aligning with the government’s projections.
The gross direct tax collections, prior to deductions for refunds, reached an astonishing ₹22.27 trillion ($268 billion), indicating an 18.74 percent growth compared to the previous fiscal year. This growth is largely due to the government’s strategic measures to enhance compliance and broaden the tax base, including the utilization of advanced data analytics and the expansion of taxes deducted at source (TDS).
Experts, such as Sumit Singhania from Deloitte India, attribute this sustained momentum in direct tax revenue to ongoing tax policy reforms and careful fiscal management. The near 20 percent year-on-year growth underscores the government’s efforts in creating a conducive tax environment and stimulating economic growth, despite global uncertainties.
India’s surge in direct tax collection not only solidifies its position as a resilient economy but also reflects the effectiveness of its tax administration and policy reforms aimed at promoting compliance and expanding the tax base.
Leave a Reply