Tax collection up 44% on strong quarterly show

The good second quarter earnings of Corporate India has reflected in buoyant direct tax collections, which has increased almost 44 per cent till October 15, 2006, compared with th Budget target growth rate of 28 per cent.

Direct tax collections up to October 15 this year stood at Rs 87,147 crore, compared with Rs 60,537 crore during April-October 15 last year. The budget had estimated overall direct tax collection at Rs 2,10,684 crore.

The increase in direct tax collections is mainly on account of a 52 per cent increase in corporation tax collection at Rs 53,853 crore, as against Rs 35,476 crore in the same period last year. The Budget had pegged corporation tax collections for the current financial year at Rs 1,33,010 crore with a growth target of 34 per cent.

Income tax collections, inclusive of fringe benefit tax, banking cash transaction tax and securities transaction tax up to October 15 this year stood at Rs 33,184 crore compared with Rs 24,939 crore, an increase of over 33 per cent. The Budget had pegged income tax collection for FY07 at Rs 77,409 crore with a growth target of around 19 per cent.

The only head which reflected lower collections is other direct taxes ""comprising primarily of wealth tax, gift tax and some older taxes such as estate duty, interest tax, expenditure tax and hotel receipt tax among others. However, barring wealth and gift tax, all the other taxes have been repealed over the years.

Collections under this head up to October 15 stood at Rs 110 crore compared with Rs 122 crore collected in the same period last year.

Revenue department officials said this is not worrying, since the overall collection under this head for the current financial year has been pegged at Rs 265 crore against Rs 307 crore collected during 2005-06.

The mop-up from securities transaction tax up to October 15 has touched Rs 2,556 crore, which is an increase of over 96 per cent compared with Rs 1,304 crore collected during the same period in 2005-06.

Fringe benefit tax collection was Rs 1,595 crore against Rs 1,018 crore last year, an increase of nearly 57 per cent. Banking cash transaction tax collections more than doubled at Rs 260 crore, as against Rs 94 crore last year, an increase of over 177 per cent.