Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: cpt :: empanelment :: TAX RATES - GOODS TAXABLE @ 4% :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARDS :: VAT RATES :: ACCOUNTING STANDARD :: TDS :: VAT Audit :: form 3cd :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: articles on VAT and GST in India :: due date for vat payment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes
 
 
News Headlines »
 Income Tax Department expands list of deposits, transactions under scrutiny
  Income-tax Act, 1961 read with Rule 114E of Income-tax Rules, 1962
 Master Directions on Access Criteria for Payment Systems
 RBI-Scheduled Bank's Statement of Position in India as on Friday, January 06, 2017 (Revised)
 3 Big Mistakes To Avoid This Tax Season
 The Top 5 Tax Stories Of 2017
 Are multiple service tax rates in the offing?
 All you need to know about claiming tax break on HRA
 How much income tax you should pay on investments in gold?
  Best ways to save tax in 2017
 8 unknown stocks that could yield huge returns

Advance tax payments indicate good quarter for banks
December, 17th 2014

Early indications emerging from advance tax payments for the December quarter suggest banks may have seen a strong quarter, possibly helped by treasury gains made on account of an increase in the value of their government bond holdings.

However, some firms such as Larsen and Toubro Ltd (L&T), often seen as a bellwether for the economy, reported lower advance tax payments, suggesting continued pressure on core sector firms.

Advance tax payments of 15 top companies registered in Mumbai for the three months ending 31 December showed a 10.1% increase from a year earlier, primarily with the help of banking companies.

To be sure, the early reported numbers are dominated by banks and final trends accounting for a wider range of companies could throw up different trends.

Indian companies pay advance tax a fortnight before the end of every quarter on their projected earnings and these numbers are seen by most analysts as a reflection of their financial performance—a relationship that usually holds up—and sometimes doesn’t.

In line with the Income-Tax Act, companies are required to pay 15% of their total advance tax in the first quarter, followed by 30%, 30% and 25% in the next three quarters, respectively.

Among banks, State Bank of India (SBI) is likely to have paid `1,420 crore, up 25.7% from a year ago as advance tax. SBI, the nation’s largest lender, has traditionally been the highest taxpayer in the Mumbai area, followed by Reliance Industries Ltd (RIL). HDFC Bank Ltd is likely to have paid `1,500 crore against `1,350 crore, up 11% for the reporting quarter, while Bank of India is likely to have paid `350 crore against `200 crore, up 75%.

Banks may have seen an improvement in earnings due to higher treasury income on account of a fall in bond yields since October. The 10-year bond yield has fallen from 8.51% on 1 October to 7.83% as of Monday’s close. This could have allowed banks to book profits on sales on parts of their bond portfolio and also book notional gains that can be used to offset provisioning requirements. Bond prices and bond yields move in reverse directions.

A slowdown in the build-up of bad loans may also ease the need for increased provisions across public sector banks, in turn boosting profitability.

Apart from banks, L&T is likely to have paid `180 crore, registering a decline of 33.3% from a year ago, while Mahindra and Mahindra Ltd posted a marginal decline in advance tax payments at `250 crore. State-owned oil marketing company Bharat Petroleum Corp. Ltd reported a 48.6% increase in quarterly advance tax to `309 crore.
According to a tax official, while Indian and foreign banks have continued to perform well, the automotive sector has underperformed this quarter. The official declined to be named.

Mint could not ascertain the advance tax payments made by the highest taxpayers in the Mumbai area such as RIL, Tata Consultancy Services Ltd and Life Insurance Corp. of India.

The Mumbai tax circle accounts for at least 33% of the total direct tax collections in the country. The current year’s tax target for the Mumbai circle is `2.3 trillion. The direct tax target for the year to next March is `7.36 trillion.

In the first six months of the financial year, net direct tax collections increased 7.09% to `2.68 trillion against a budget target of 15.31% for 2014-15. This was due to high income tax refunds of 54.51% during the period, according to the Central Board of Direct Taxes.

Gross direct taxes collection during the April-September quarter of 2014-15 are up 15% at `3,46,144 crore, against `3,01,063 crore collected during the same period last year. ??

The gross collections of corporate tax have shown an increase of 15.31 % to `2.22 trillion against `1.93 trillion collected during the same period last year. Advance tax collection has also shown a growth of 15.28% during the first half of the year against growth of 7.66% shown at the same time previous year.

“Historically, I believe advance tax collection is an imperfect indicator of GDP (gross domestic product) growth. Having said that, what has clearly emerged over the past six months is that the economy is recovering slowly and steadily. My sense is that we should continue to see this improvement over next quarter as well,” said Saurabh Mukherjea, chief executive officer of the institutional equities business at Ambit, an investment management services company.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Content Management System development CMS development Content Management Solutions CMS Solutions Content Management Services CMS Services CMS Software

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions