An enhanced target Rs 400,000 crore set by the government for the Central Board of Direct Taxes (CBDT) to mop up in the current fiscal looks difficult to achieve going by the rate at which tax collection is growing.
Direct tax collections grew by around 4% to Rs 87,888 crore in the first five months of this fiscal. It had grown by 3% in the first four months.
Direct tax collections like corporate and personal income tax, and STT during April-August were at Rs 87,888 crore, a rise of 4.12% over last year's collection during the same period, an official statement said on Thursday.
Corporate tax collections during this period grew by a meagre 1.84% to Rs 49,339 crore compared to Rs 48,450 crore a year ago.
Collections under personal income tax, including securities transaction tax (STT), the residual Fringe Benefit Tax and remaining BCTT, grew by 7.4% to Rs 38,491 crore from Rs 35,840 crore in the previous year. Net collections during August 2009 remained positive at Rs 13,898 crore compared to Rs 12,761 crore during August 2008.
The increase in STT during April-August 2009 to Rs 2,924 crore as against Rs 2,730 crore in the corresponding period last fiscal indicates recovery of stock market.
The second instalment of corporate advance tax and the first instalment of non-corporate advance income tax will be due on 15th September 2009, that would give some clear picture on the tax collection for the next few quarters.
The advance tax liability for both categories of taxpayers, corporate and non-corporate, is 30% of the estimated total tax liability for the financial year.