This could be the first signs of an economic revival of the boondocks, Bihar. The latest corporate tax collections figures have left tax officials at North Block baffled as the state has totted up the highest growth in the first half at 265%.
Although this comes on a smaller base, revenue officials say the state shows high tax collections in absolute numbers as well. The collections from Patna, which shows collections from both Bihar and Jharkhand, grew from Rs 123 crore in April-September 2006 to Rs 451 crore in April-September 2007.
Analysts say a better political system and efficient administration could be finally attracting investments in the state, particularly in construction sector. In fact, individuals too seem to be reaping the benefits of changing economic scenario. An indication of this is the rise in tax deducted at source collections. Patna witnessed a growth of 43.09% in personal income tax collections at Rs 559 crore.
The Centre collected 40% more in direct taxes at Rs 1,11,055 crore in the first half this fiscal compared to Rs 79,208 crore a year ago. Corporate tax recorded a growth of 41% to touch Rs 72,240 crore, up from Rs 49,813 crore in the year-ago period. Personal income tax, including fringe benefit tax (FBT), securities transactions tax (STT) and banking cash transaction tax (BCTT), rose by 39% to Rs 40,744 crore in the period under review.
Patna is followed by Kochi in corporate tax collections with a growth rate of 104.7% to Rs 387 crore, compared to Rs 198 crore in the year-ago period. Financial hub Mumbai registered a growth of 96% in corporate taxes and 40% in personal income tax at Rs 29,509 crore and Rs 13,464 crore, respectively. Capital city Delhi saw collections from corporate taxes growing by only 8% and personal income tax by 29% at Rs 11,305 crore and Rs 4,064 crore, respectively.
The collections in Lucknow grew by 76.73% to Rs 290 crore. Chandigarh, which shows tax collections from Punjab, Haryana and Jammu and Kashmir, witnessed a growth rate of 40.70% at Rs 1,560 crore.
Interestingly, Nagpur which recorded a negative growth of 33.45% in corporate tax collections at Rs 320 crore, exhibited the highest growth of 82.99% in personal income tax collections at Rs 336 crore. Nagpur is responsible for collections in the Vidarbha zone in Maharashtra.
A similar trend was seen in Bhubaneshwar. While the corporate tax collections from this zone declined by 11.43% to Rs 584 crore, personal income tax collections grew by 29.62%. Bhopal, responsible for collections from Madhya Pradesh showed a decline in both corporate and personal tax collections. Corporate tax collections from the zone declined by 22.25% to Rs 645 crore and personal income tax collections by 8.3% to Rs 863 crore.
On the personal income tax front, cybercity Hyderabad followed Nagpur closely with a growth rate of 70.37% to Rs 2,549 crore. Ahmedabad witnessed a growth of 59.35% in personal income-tax collections at Rs 1,746 crore.