Impressive Growth in Direct Tax Revenues and GST Collections
The fiscal year 2023-24 has marked a significant milestone for India’s financial landscape, with direct tax revenues climbing by an impressive 18 percent. This surge is mirrored in the performance of the goods and services tax (GST), which saw its total collections surpass the Rs 20 lakh crore mark for the first time, indicating a robust growth of 12 percent over the prior year. These figures not only reflect a healthy economy but also underscore the government’s success in tightening the screws on tax evasion and underpayment.
Efforts to widen the tax net have been a focal point for the government, aiming to incorporate more individuals into the formal tax-paying bracket. Despite the increase in revenue, the proportion of income tax payers in India remains relatively low, a challenge that has persisted across various administrations. The latest data, however, presents an optimistic picture, particularly in the realm of personal income tax, which has witnessed a substantial 25 percent year-on-year growth, outpacing the more modest 10.26 percent rise in corporate tax collections.
In terms of absolute numbers, personal income tax collections have reached Rs 10.44 lakh crore, overtaking corporate taxes by a considerable margin. While personal income taxes typically represent 17-18 percent of India’s total tax collection, there is a push to increase this share to align more closely with developed nations where personal income taxes form a larger part of the tax base.
Advancements in technology and a focus on the digital economy have been instrumental for the tax department in monitoring significant transactions by individuals. Tools such as
As India continues to evolve its tax infrastructure, the focus remains on sustainable growth in both personal and corporate tax revenues. This will not only strengthen the nation’s finances but also ensure a fairer distribution of the tax burden across different segments of society.
