In an indication of economic recovery, the cumulative advance tax collection till date in the current financial year have zoomed past the collection made in the pre-Covid era.
The advance tax collection at ₹4,59,917.1 crore is up 53.5% compared with corresponding period in the previous financial year at ₹2,99,620.5 crore, according to data from the ministry of finance. Also, the current year's collection till December 16 is up 44.21% from ₹3,18,929.4 crore collected in the corresponding period of the pre-Covid fiscal of 2019-20 - the year which had a muted economic growth owing to slowdown caused by multiple factors.
The finance ministry data also reveals that the FY22 April-December collection is up 49.76% over the corresponding period in FY 2018-19 when the advance tax collection (cumulative) was ₹3,07,096.3 crore.
"The Advance tax figure of ₹4,59,917.1 crore as on 16.12.2021 comprises corporate income tax (CIT) at ₹3,49,045.4 crore and personal income tax (PIT) at ₹1,10,871.7 crore. This amount is expected to increase as further information is awaited from banks. Refunds amounting to ₹1,35,093.6 crore have also been issued in the FY 2021-22 so far," the ministry of finance said in a release short while back.
"The advance tax collection are quite encouraging and showing a progressive trend. This is also depictive of robust growth trajectory of Indian economy," said Amit Singhania, partner, Shardul Amarchand Mangaldas & Co.
"Robust advance tax and gross tax collections set the stage quite nicely for continuing tax reforms agenda as the budgetary exercise for next fiscal gets underway. The growth registered in corporate tax collections vis-à-vis pre-pandemic years (i.e., FY19 and FY20) also reflects the yield of tax rate rationalisation and phasing out of tax holiday/incentives in recent years. One would hope the latest statistics provide adequate confidence to the tax policy makers in continuing progressive reforms including tax administration overhaul through digitisation," said Sumit Singhania, Partner, Deloitte India.
Meanwhile according to the data from the ministry, net direct tax collection for 2021-22 as on December 16, stands at ₹9,45,276.6 crore, up 60.8% from ₹5,87,702 crore in the the same period of the previous financial year. The net collection in the current year is up 40% from FY20 April-December collection of ₹6,75,409 crore.
"The net direct tax collection of ₹9,45,276.6 crore (as on 16.12.2021) include corporate income tax (CIT) at Rs 5,15,870.5 crore (net of refund) and personal income tax (PIT) including security transaction tax (STT) at ₹4,29,406.1 crore (net of refund)," according to the release from the ministry of finance.