BackDirect, indirect tax collection picks up in first quarter
Data released on Friday showed direct tax collections grew 25% to Rs1.24 trillion in April-June while indirect tax collection jumped 30.8% to Rs2 trillion
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New Delhi: Direct and indirect tax collections picked up in the fiscal first quarter on account of early advance tax mop-up and increase in the service tax rate and excise duty, respectively.
Data released by the revenue department on Friday showed direct tax collections grew 25% to ₹ 1.24 trillion in April-June while indirect tax collection jumped 30.8% to ₹ 2 trillion during the same period.
Revenue secretary Hasmukh Adhia tweeted that if one removes the additional resource mobilization, indirect tax collections grew 10.2% in the June quarter.
The main reason for the increase in direct tax collection is the change in requirements for advance tax payment—even in the case of individuals—made in last year’s budget.
Individuals are now supposed to pay four instalments of advance tax at 15%, 30%, 30% and 25% in the months of June, September, December and March.
Earlier there were only three instalments of advance tax to be paid by individuals in the months of September, December and March.
After accounting for refunds, the net growth in personal income tax is 48.75% and corporate tax is 4.43%. In personal income tax, refunds during April-June 2015-16 were much higher than in the corresponding period of the current fiscal.
“Total 14.63% of the annual budget target of direct taxes has been achieved in the first three months of the year," tweeted Adhia.
Within direct tax, the trend in gross revenue of corporation tax is indicating an increase of 13.5% while in personal income tax (including securities transaction tax, etc.) it is pointing at an increase of 29.8%. However, after adjusting for refunds, the net growth in corporation tax is at 4.43% while that of personal income tax is at 48.75% as compared with the previous year. This increase is mainly due to large refunds made in the previous year as compared with the current year, the revenue department said in the statement.
Within indirect tax, while excise duty grew 50.1%, higher service tax rate helped it increase 20.8%, while customs duty collection rose 15.5% during the June quarter.
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