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Tax trends spur hopes of recovery: Ajay Bhushan Pandey
- Collections from advance tax and tax deducted at source (TDS) in the June quarter was almost 80% of what was collected in the same time a year ago
- Central and state governments collected ₹90,917 crore as Goods and Service Tax revenue in June, signalling an uptick in economic activities
NEW DELHI: Signals from latest direct and indirect tax collections are encouraging and give hopes of a recovery in growth, said finance secretary Ajay Bhushan Pandey.
Collections from advance tax and tax deducted at source (TDS) in the June quarter was almost 80% of what was collected in the same time a year ago, which was a good sign, according to Pandey, as a drop in sales could have pushed companies into losses rather than merely depressing the corporate taxes paid.
“In income tax, if turnover falls by 20%, it is not that the corporate tax paid by the company may reduce by 20%. But the company may fall into losses and may not pay us any tax... In first quarter, we were able to collect 80% of the revenue collected last year,” explained Pandey.
This, despite the fact that corporate tax rates were slashed last September which influences the advance tax payments this year, but had not influenced the same last June. Pandey did not give the tax collection figures. He was speaking at the annual capital market conference organised by industry chamber Federation of Indian Chambers of Commerce and Industry (Ficci).
Central and state governments collected ₹90,917 crore as Goods and Service Tax (GST) revenue in June, signalling an uptick in economic activities after the coronavirus crisis had depressed collections severely in the previous two months. Gross GST receipts for June was 9% below the roughly ₹1 trillion collected in the same month a year ago.
“The 80% advance tax and TDS receipts and June GST collection give us some hope that businesses are finding ways to get started and do their business,” the finance secretary said.
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First Published:23 Jul 2020, 04:54 PM IST
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