Net direct tax mop up exceeds revised estimates at Rs 9.45 lakh crore in FY21 – The Economic Times

Clipped from: https://economictimes.indiatimes.com/news/economy/finance/indias-income-tax-receipts-surpass-revised-budget-target-for-2020/21-official/articleshow/81983940.cms?utm_source=ETTopNews&utm_medium=HPTN&utm_campaign=AL1&utm_content=23Synopsis

“Net direct tax collections for the financial year 2020/21 have shown an upswing, despite the inherent challenges brought on by the COVID-19 pandemic,” Pramod Chandra Mody, head of the Central Board of Direct Taxes told reporters on Friday in virtual briefing.

India’s net direct tax collections for fiscal 2020-21 stood at Rs 9.45 lakh crore, representing almost 5% growth over the government’s revised estimate (RE) in the Union Budget.

The direct tax collections have shown an upswing despite the inherent challenges to the economy brought on by the Covid-19 pandemic, the finance ministry said in a statement on Friday.

Net direct tax revenue was made up of Rs Rs. 4.57 lakh crore corporate tax and Rs 4.88 lakh crore personal tax collections, which included Security Transaction Tax.

Tax refunds for the recently-concluded fiscal also saw growth of 42% at Rs 2.61 lakh crore compared to Rs 1.83 lakh crore refunds issued in FY20, according to data shared by the ministry.

The figures were along expected lines of a modest overshooting of the government’s estimates and in line with the economic recovery the country was witnessing, experts said.

The Centre had projected net direct tax collections of Rs 9.05 lakh crore in the RE for FY21.

While the current figures were provisional, net direct tax collections contracted 10% in comparison to the FY20 tax mop up.

Collections for March also recorded an annual contraction of 3.5%, which indicated a back-ended release of refunds, according to Aditi Nayar, principal economist at ICRA.

The growth over the RE, including indirect tax collections, suggested a lower fiscal deficit for FY21 compared to the government’s expectations, provided there was no slippage on expenditure, said DK Pant, chief economist at India Ratings and Research.

“We expect the fiscal deficit to be limited to Rs. 17.0 -17.2 trillion (lakh crore) for the just-concluded fiscal,” Nayar said.

The FY21 fiscal deficit target was raised to Rs 18.48 lakh crore or 9.5% of gross domestic product (GDP) from Rs 7.96 lakh crore or 3.5% of GDP.

Gross direct tax collections, before adjusting for refunds, stood at Rs 12.06 lakh crore. Advance tax collections for FY21 grew about 6.7% at Rs 4.95 lakh crore, the statement said.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s