Net direct tax collection grows 16% annually to ₹9.95 trillion up to 17 Sep

New Delhi: Net direct tax collection after adjusting for refunds has grown 16% so far this financial year to ₹9.95 trillion, led by strong growth in taxes on personal and corporate incomes and on trading in securities, Central Board of Direct Taxes (CBDT) said on Wednesday.

This includes strong personal and corporate income tax receipts collected as the first and second instalments. The second of the four instalments to be paid in a year, was due on 15 September.

So far, individuals and businesses have paid ₹4.36 trillion in advance tax, showing a 23% jump from the year-ago period. 

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Strong growth

The strong growth was led by advance personal income tax collected up to 17 September,  which showed an annual increase of 39% at ₹1 trillion, while advance corporate tax receipts grew 18% to ₹3.3 trillion, data shared by CBDT showed.

The income tax department issued refunds of ₹2 trillion so far this year, showing a phenomenal 57% jump from the year ago period. 

Before adjusting for tax refunds, gross direct tax receipts from personal and corporate incomes and from security trade stood at ₹12 trillion, showing a 21.5% annual growth. 

Showing robust stock market activity, tax revenue from securities transactions (STT) nearly doubled in the 1 April to 17 September period this year to ₹26,154 crore. STT receipt was at ₹13,352 crore in the same time a year ago. 

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The government is aiming to collect ₹22 trillion in direct taxes in this financial year, according to Union budget documents. Of this, ₹11.87 trillion is expected to be from personal income tax.

Rohinton Sidhwa, partner at Deloitte India said that personal income tax receipt continues to show strong growth and is pulling ahead of corporate income tax, a continuing trend over the last two years. 

Advance tax also shows strong growth over the previous year indicating the inherent strength and growth of the economy, said Sidhwa.

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