India’s Net Direct Tax Collections Surge by 17.7%
In a clear indication of buoyancy in the economy and a rise in income levels, India has witnessed a significant uptick in its net direct tax collections. The Finance Ministry’s recent data release revealed that the country’s net direct tax mop-up soared to Rs 19.58 crore, marking a year-on-year increase of 17.7 percent after refunds for the fiscal year that concluded in March 2024.
The provisional actual collections on net direct tax not only showed robust growth but also surpassed the revised estimates by a substantial Rs 13,000 crore. This overachievement reflects the government’s efficiency in tax collection and economic management.
Moreover, the gross direct tax collections for FY24 experienced an 18.48 percent rise, reaching Rs 23.37 lakh crore. This growth is attributed to the concerted efforts of both individuals and corporates, which have contributed to the net direct tax mop-up. Corporate tax collection in gross terms stood at Rs 11.32 lakh crore, which is a 13.06 percent increase compared to the previous year. In net terms, corporate tax collection rose by 10.26 percent year-on-year, amounting to Rs 9.11 lakh crore.
The personal income tax segment also showed remarkable performance with a gross mop-up of Rs 12.01 lakh crore, growing by 24.26 percent over the last year. The net personal income tax collection saw an even higher growth rate of 25.23 percent, reaching Rs 10.44 lakh crore.
Notably, the government has been proactive in issuing direct tax refunds, which amounted to Rs 3.79 lakh crore for FY24, marking a 22.74 percent increase from the previous fiscal year’s refunds. This proactive approach not only reflects the government’s commitment to transparency but also aids in maintaining liquidity for taxpayers.
The impressive tax collection figures have played a crucial role in helping the government meet its fiscal deficit targets. The Centre has revised its fiscal deficit target for FY24 to 5.8 percent, down from the earlier projection of 5.9 percent, while setting a target of 5.1 percent for the current fiscal year.
Overall, these numbers are indicative of a strong economic framework and suggest that India is on a path of sustainable growth and fiscal prudence.
