Here are some statistics that clearly suggest that the economy is recovering from the downturn. The total direct tax collected from all over India in the April-to-September period has matched last years growth in collections, indicating that concerns of a lower mop up due to reduced corporate earnings are unfounded.
The all India figure for direct tax collection till September 5, totalled Rs 90,039.7 crore, while the comparative figure for the corresponding period last year was Rs 88,588.9 crore.
While direct tax collection had grown by more than 70% in the same period last year, it was followed by a steep decline in tax collection for the rest of the year as the Lehman Brothers collapse and the resulting financial meltdown took its toll. The shortfall in tax collection later stood at about Rs 60,000 crore.
While lower corporate profitability was widely expected to lead to lower tax outgo, the growth in collections is being read by tax professionals, as a certain sign of recovery in the economy.
Though the last date of the second installment of advance tax is due on September 15, some amount of tax such as self assessment tax and TDS is paid in the beginning of September. Usually, the trend is visible in these early figures.
Advance taxes are paid in four installments in June, September, December and March. Under normal circumstances, the trend till September continues till the end of the fiscal year, provided nothing unusual happens in the rest of the year.
The finance ministrys projection for direct collection in the current fiscal year is about Rs 400,000 crore. Direct tax collected from Mumbai, which accounts for over 35% of the all India direct tax collection, saw a 4.4% increase over the year-ago figure, to Rs 34,943 crore. This included revenue from advance taxes, self assessment taxes and regular assessments.
The Delhi Commissionerate, on the other hand, which raised Rs 12.073.5 crore fell 17%. However, collection from the Ahmedabad commissionerate went up by 22.6% to Rs 3,752.6 crore. Bhopal has recorded a 240% increase in collection to Rs 1,237 crore.
Revenue from the commissionerates of Chennai, Hyderabad, Kolkata, Chandigarh, Meerut, Bhubaneswar, Jaipur, Kochi, Lucknow and Kanpur showed significant growth over the year ago figures. However, Meerut, Bangalore and Patna showed a negative growth, according to statistics from the tax department.