Banking majors such as State Bank of India and ICICI Bank are likely to post robust first quarter results this year going by the first instalment of advance tax paid by them by June 15.
According to available information, Union Bank of Indias advance tax payment was 88 per cent more than what it paid for the corresponding period last year, but SBIs tax payment at Rs 663 crore for the April-June 2008 period was the highest going by available numbers.
Companies have to pay advance tax in four instalments the first, accounting for 15 per cent of the estimated tax liability for the entire year.
The second by September 15 for 45 per cent of the tax liability for the year; the third by December 15 for 75 per cent of the tax; and, the last by March 15 accounting for the balance tax liability for the year.
SBI was the second highest tax payer in 2007-08 with a tax provision of Rs 4,063 crore.
For the March 15 instalment in 2007-08, the largest public sector bank had paid Rs 1,418 crore.
According to an official with a private sector bank, advance tax outflow for the year is expected to be between Rs 25,000 crore and Rs 30,000 crore.
The Finance Ministry had estimated a direct tax collection of Rs 3,65,000 crore for the year.
The Ministry is now thinking of increasing this target to Rs 4,00,000 crore for the year.