Net direct tax collections rose 47 per cent to Rs 71,756 crore in the first four months of fiscal 2008-09, compared with Rs 48,756 crore in the corresponding period last fiscal. The net direct collections refer to the Centre’s collections, less of refunds, but before devolution of the states’ share.
The strong growth in direct tax collections indicates that the impact of a slowdown in the economy is yet to get fully reflected on corporations, who paid 50 per cent more tax at Rs 41,598 crore during April-July this year, as against Rs 27,718 crore in the same period last year.
Personal Income Tax (including Fringe Benefit Tax, Securities Transaction Tax and Banking Cash Transaction Tax) also grew 42.82 per cent to Rs 29,982 crore, as against Rs 20,993 crore in the year-ago period.
“The low base and increase in tax deducted at source (TDS) contributed significantly to the tax collection growth till July this year,” said a senior Income Tax official.
Second quarter advance tax instalment, which is due on September 15, will give a better indication of corporate profitability as well as tax collection growth in 2008-09, the official added.
Direct tax collections need to grow at over 25 per cent to achieve the Central Board of Direct Taxes’ internal target of Rs 3,95,000 crore in the current fiscal, compared with Rs 3,14,000 crore collected in 2007-08.
The growth in corporate TDS collections was very high at 60 per cent. Generally, corporations give lot of contracts in the beginning of the financial year. Overall TDS collections rose 44.56 per cent Rs 45,935 crore, as against Rs 31,776 crore in the year-ago period.
Collections from Fringe Benefit Tax grew 44.34 per cent to Rs 1,260 crore as against Rs 873 crore; Securities Transaction Tax grew 15.46 per cent to Rs 2,164 crore as against Rs 1,874 crore; and Banking Cash Transaction Tax rose 33.75 per cent to Rs 223 crore as against Rs 167 crore.
Among regions, tax collection growth in Mumbai and Delhi was 36 per cent and 76 per cent, respectively. Other regions which saw high tax collection growth are Nagpur (77.80 per cent); Kochi (58.08 per cent); Kolkata (49.87 per cent); Hyderabad (40.69 per cent) and Bangaluru (40.25 per cent).
