Due to a notable increase in personal income tax, India’s net direct tax revenues increased by 17.7% to reach Rs 19.58 lakh crore in FY24. According to official government figures, the receipts marginally exceeded the revised forecasts of Rs 19.45 lakh crore by 0.7%.
The goal for collecting direct taxes was first set at Rs 18.23 lakh crore, but it was subsequently increased to Rs 19.45 lakh crore. As of right now, refunds have increased significantly, yet collections have still outpaced both the original and amended expectations by 7.7% and 0.7%, respectively.
The increase in personal income taxes caused its portion to rise from 50.06% to 53.3%, while the contribution from corporate taxes fell from 49.6% to 46.5%.
Corporate income tax (CIT) and personal income tax (including securities transaction tax) are examples of direct taxes. A rise in direct taxes is indicative of rising personal income and corporate profits. In FY 24, net personal income tax collection (which includes securities transaction tax, or STT) increased by 25.23% year over year to R10.44 lakh crore. In contrast, the preliminary net corporate tax collection for FY24 was Rs 9.11 lakh crore, a 10.26% increase over the R 8.26 lakh crore collected the year before.
The government released a statement saying, “Refunds of R3.79 lakh crore have been issued in the FY 2023-24 showing an increase of 22.74% over the refunds of R 3.09 lakh crore issued in FY 2022-23.”
“As the Indian economy wades through general election in Q2, continued growth in direct tax collections signifies macro-economic buoyancy which is reassuring from the standpoint of continuity of fiscal discipline, which ought to allow the incoming administration to hit the policy reforms road running, keeping the goal of improving taxpayers services at the core of tax reforms agenda,” stated Sumit Singhania, Partner, Deloitte India, in response to the direct tax collection numbers.