Direct Tax In India Grows In Year To October 31

by Philip Morton, Investors Offshore.com

07 November 2007

The Indian government this week unveiled direct tax collection figures for the period ending October 2007.

According to the newly published figures, direct tax collection maintained growth of over 40% up to the end of last month. Net tax collections stood at Rs.128,864 crore, up from Rs.90,180 crore during the same period last fiscal, registering a growth of 43.15%.

The figures additionally revealed that corporate tax collection had recorded growth of 45.71% at Rs.78,785 crore, up from Rs.50,072 crore during the previous fiscal.

Personal income tax (including FBT, STT and BCTT) grew by 39.39% at Rs.49,890 crore, up from Rs.35,805 crore.

Growth in Securities Transaction Tax (STT) was 57.61% (Rs.3,783 crore against Rs.2,400 crore) and Fringe Benefit Tax (FBT) was 29.94% (Rs.2,755 crore against Rs.2,120 crore). Banking Cash Transaction Tax (BCTT) grew by a modest 15.79%, indicating decreasing incidence of large cash withdrawals.

In terms of payment types, advance tax increased by 28.44% and tax deducted at source (TDS) by 49.13%, indicating all-round buoyancy in taxes. Self-assessment tax grew by 77.64% , indicating better tax compliance levels.

Refund payouts in personal income tax (PIT) category were ahead by 47.16% (Rs.6,135 crore against Rs.4,169 crore), with over 30 lakh refunds having been issued during the period.

The government observed this week that:

"Continued buoyancy in direct tax collections indicates healthy growth in the economy, better tax administration and improving tax compliance levels."

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