The Finance Ministry has reported a substantial 18.48% rise in gross direct tax revenues for the fiscal year 2023-24, reaching Rs. 23.37 lakh crore. The net revenues also saw a commendable increase of about 17.70% to Rs. 19.58 lakh crore.
This surge is mainly attributed to robust collections from individual taxpayers, reflecting enhanced compliance.
Exceeding Expectations
Provisional figures for net direct tax revenue, after refunds, surpassed both the Budget Estimates (BE) and the Revised Estimates (RE) for FY24. Refunds witnessed a significant 22.74% increase, totaling Rs. 3.79 lakh crore.
Post-refund, the net collection for FY24 exceeded the BE by Rs. 1.35 lakh crore and the RE by Rs. 13,000 crore.
Budget Projections and Realizations
The provisional direct tax collections surpassed the BE by 7.40% and the RE by 0.67%. Notably, the RE was revised upward based on estimates of higher personal income tax (PIT) collections, while no change in corporate income tax (CIT) was anticipated.
The initial BE projected a net direct tax collection of a little over Rs. 18.23 lakh crore, later revised to Rs. 19.45 lakh crore.
Corporate Income Tax and Personal Income Tax Collections
Gross CIT for FY24 stood at Rs. 11.32 lakh crore, marking a growth of 13.06% over the preceding fiscal year.
However, the net CIT of Rs. 9.11 lakh crore in FY24 fell short of the BE and RE projections for the year. On the other hand, gross PIT, including securities transaction tax (STT), saw a remarkable 24.26% increase to Rs. 12.01 lakh crore in FY24. After refunds, net PIT surged by 25.23% to Rs. 10.44 lakh crore.
Refunds and Growth Trends
The income-tax department issued refunds totaling Rs. 3.79 lakh crore in FY24, indicating a substantial 22.74% rise over the previous fiscal year. This increase in refunds reflects a growing trend of compliance and a robust tax collection system in place.
Implications and Future Outlook
The surpassing of revenue targets underscores the effectiveness of tax policies and administration in ensuring compliance and boosting revenue.
The strong growth in both CIT and PIT collections indicates a positive trajectory for the economy. Moving forward, sustaining this growth momentum and fostering compliance will be crucial for fiscal stability and economic development.
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