In its zeal to prove critics wrong about falling direct tax collections, finance ministry goofed-up, announcing on Friday a highly exaggerated advance tax growth of nearly 77 per cent in Q1, only to be corrected very next day to a realistic 19 per cent.
A finance ministry official on Friday told a group of select media that advance taxes paid by the corporate sector increased a whopping 76.8 per cent to Rs 30,399 crore in the first quarter of this financial year as compared to the corresponding previous year. This could swell further in next few days with more companies pay their dues, signifying revenue buoyancy and profitability of the company.
As these unrealistic numbers hit the headlines, the central board of direct taxes got into the damage control mode very next day with its chairman Prakash Chandra officially releasing the advance tax payout figures, whose first instanlment is made on or before the June 15 deadline.
For the June 15 instalment (this year), advance tax payments stood at Rs 31,262 crore, registering a 19 per cent increase over Rs 26,293 crore collected for the same instalment last year, India Incs advance tax payments for the June 15 instalment last year recorded 33 per cent growth, Chandra told reporters quoting the latest advance tax figures available with the revenue department.
He however did not explain on how did the error of 77 per cent growth crept-in.
Corporates make advance tax payouts four times a year with deadline fixed as June 15, September 15, December 15 and March 15.
Chandra said CBDT expected 25 per cent growth in corporate advance tax collections in first quarter and the numbers would be finalised in the next few days. Usually the numbers are available around 20th of the month in which advance tax is due as there are some spill over in the collections. It is normally released around 20th and it is not clear why government chose to release it a bit earlier this time.
"The 20 per cent plus growth that we see in corporate advance tax is reasonably good growth. Our overall gross in tax collections till date this quarter has increased 24 per cent. The TDS growth this year is also higher at 29 per cent, from 20 per cent level last year. We are comfortable, Chandra said.