Tax collections surge to Rs3.23 lakh crore fiscal first quarter
09 July 2016
Government's tax collections - both direct and indirect – saw a sharp rise in the first quarter of the current financial year, with the overall tax kitty swelling to Rs3.23 lakh crore.
Appeared to give the Centre, which has some heavy spending lined up, a bit of elbow room, although the data set comes with some caveats.
According to the data released by the finance ministry on Friday, indirect tax collections jumped 30.8 per cent between April and June 2016 to Rs1,99,790 crore. Net direct tax receipts are estimated to have grown by 24.79 per cent to Rs1.24-lakh crore in the period.
The gross tax collection target is pegged at Rs16,30,888 crore, which marks a 12.5 per cent rise over the Budgeted Rs14,49,490 crore last fiscal.
However, both the data sets need to be read with some caution. The rise in indirect tax collections was primarily due to additional resource mobilisation measures, including the higher excise duty, while the direct tax mop-up rose largely owing to a revised schedule for individuals to pay their advance tax.
Revenue Secretary Hasmukh Adhia said that if the additional resource mobilisation measures, including on fuel, are factored out, the indirect tax collections grew only 10.2 per cent. The sharpest rise was in central excise collections, which grew 50.1 per cent to Rs91,225 crore in the first quarter from Rs60,787 crore a year ago.
Service tax receipts grew 20.8 per cent to Rs91,225 crore during the period from Rs44,503 crore last fiscal. Customs revenue collection was Rs54,808 crore against Rs47,450 crore last year, a growth of 15.5 per cent, said the Central Board of Excise and Customs.
In the case of direct taxes, the net corporate tax collections mop-up was just 4.43 per cent while that of personal income tax (including securities transaction tax) jumped by 48.75 per cent in the first quarter.
The CBDT, however, said the low growth in corporate tax was due to adjustments for refunds. Gross direct tax revenue grew 13.5 per cent in the period.
Explaining the sharp rise in direct tax receipts, the Central Board of Direct Taxes said, ''The main reason for this increase is the change in the requirements for advance tax payment even in respect of individuals, made in last year's Budget.''
Earlier, advance taxes were required to be paid in three tranches; this fiscal, individuals are expected to pay them in four installments.
''The collection up to June indicates that 14.63 per cent of the annual budget target of direct taxes has been achieved in the first three months of the 2016-17,'' said Adhia.