Gross Direct Tax Collection For April-November Registers Growth Of 7.1%, Income Tax 15%

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Mumbai (I-Newswire) January 7, 2013 - The Finance Ministry of India has released the figures of tax collection for the period of April-November with details of the Gross Direct Tax Collection, the Corporate Tax Collection, Personal Income Tax Collection, Wealth Tax Collection, Securities Tax Transaction Collection, the Net Direct Tax Collection, and the nation’s Industrial Output coming to the fore.

The Gross Direct Tax Collection stood atRs. 3.25 lakh crore, an increase of 7.14 per cent from the Rs. 3.04 lakh crore for the same period the previous year. The annual target of 15% could not be met and a slowdown incorporate activity was cited as the chief reason behind it.

Standing at Rs. 2.95 lakh crore, theCorporate Tax Collection figures reflected a growth of three per cent as against Rs. 1.99 lakh crore for the same period the last fiscal year.

The figures for the Personal Income Tax Collection however registered a substantial increase of 14.94 per cent and stood at Rs. 1.19 lakh crore compared to the figures of Rs. 1.04 lakh crore over the same period the preceding year.

The Wealth Tax Collection too grew from Rs. 487 crore to Rs. 619 crore registering a growth of an impressive 27.10 per cent.Also registering a notable growth of 15.04 per cent were the figures for Net Direct Tax Collection which now stand at Rs. 2.71 lakh crore as against Rs. 2.35 lakh crore for the corresponding fiscal period the previous year.

A decline was noted in the Securities Transaction Tax Collection with figures showing Rs. 2,914 crore as against Rs. 3,343 crore last year for the same nine month period, a drop of 0.1 per cent from.

Mr. Aashish Ramchand, the Chief Executive Officer of MakeMyReturns.com, a leading tax help portal said, “The increase in tax collections really signifies one very important point, an increase in compliance. The maximum increase is seen in the personal tax collection. An increase in slab rates for personal income tax should generally spell out a lower tax collection as an individual who has earned the same income in earlier years will pay less tax due to the inSubstantial Income Tax Rate Relief Upon Introduction of DTCcrease in slab rates. However as the personal tax collections have increased this year, the tax compliance would also have surely increased.”

Mr. Ramchand, explaining the situation related to Corporate Tax figures said, “Corporate tax collections have shown a minimal increase from the last year. This may primarily be due to lower industrial output in this year vis-a-vis earlier years. Also the service sector in India has been impacted this year as compared to earlier years.”

The results brought in mixed reactions from financial experts with some of them applauding the growth in figures such as Personal Tax and Wealth Tax collections while others explained the fall in the Securities Transaction Tax figures and attributed it to reduced activity in Indian stock exchanges.

With relation to the reduction in Securities Transaction Tax figures, Mr. Ramchand had this to say, “A sharp decrease in STT can only signify one thing, a decrease in share market related activities. There would have been lesser transactions in the Indian stock markets and lower investments in equity related funds.”

The Finance Minister of India Mr. Chidambaram had made it clear before that the Direct Tax Target of Rs. 5.70 lakh crore for the fiscal year 2012-2013 is set to be achieved with the Income Tax Department implementing a more direct approach. Speaking about the growth target of 15% that has been set, he pointed out that the latter half of the financial year will see an increase in collections.

Mr. Ramchand, summing up the figures in a positive light said, “An overall increase in direct tax collections this year is a good sign even despite slower corporate activity and lower industrial activity in the country.”

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