05 Apr Center Appears to Have Achieved Fiscal Year 2024 Gross Tax Objective
The year 2023-24 not only witnessed multi-year high tax buoyancy levels – mainly on the direct taxes front – but also higher level of compliance from taxpayers, and strict enforcement measures against tax evaders. Total tax receipts (before devolution to states) of the Centre in FY24 “slightly exceeded” the revised estimate (RE) of Rs 34.37 trillion in the year, an official source told FE on condition of anonymity, even as the figures are being computed.
Tax Revenue Performance in FY24
- Buoyant Tax Environment: FY24 witnessed multi-year high tax buoyancy levels, particularly in direct taxes, indicating robust revenue generation.
- Increased Compliance: Taxpayers displayed higher levels of compliance, contributing to the overall revenue surge.
- Stringent Enforcement: The government implemented strict enforcement measures against tax evaders, further bolstering revenue collection efforts.
Revenue Figures
- Exceeding Revised Estimate (RE): Total tax receipts of the Centre for FY24 slightly exceeded the revised estimate of Rs 34.37 trillion, according to an official source.
- Gross Tax Revenue: As of April-February FY24, the Centre's gross tax revenue reached Rs 28.9 trillion, accounting for 84% of the RE of Rs 34.4 trillion.
- Net Tax Revenues: The attainment of the RE of Rs 23.24 trillion for net tax revenues (post-devolution) is yet to be confirmed, but deviations from the target are not expected.
Tax Buoyancy and Collection Trends
- Buoyancy Surge: The Centre recorded a tax buoyancy of 1.5 in the first eleven months of FY24, significantly higher than the 0.9 recorded in FY23, indicating a strong revenue response to GDP growth and tax policy changes.
- Personal Income Tax (PIT) Collections: PIT collections witnessed a record-high growth of 25.8% in April-February FY24, primarily due to increased compliance.
- Corporate Tax Collections: Corporate tax collections surged by 17.3% in the first eleven months, surpassing the RE of FY24, driven by robust advance tax collections.
- Advance Tax Collections: Advance tax collections for FY24 stood at Rs 9.11 trillion as of March 17, marking a 22.31% increase year-on-year.
Indirect Tax Performance
- GST Collections: Gross GST collections in FY24 amounted to Rs 20.18 trillion, up 11.7% from FY23, indicating higher compliance and broadening of the tax base.
- CBIC Initiatives: The CBIC initiated a focused drive in May 2023 to combat tax evasion, resulting in the detection of bogus firms and suspected Input Tax Credit (ITC) evasion, saving significant revenue for the Centre.
- Customs and Excise Duties: Collections from customs duty and excise duty remained strong, reflecting vigilant efforts by tax departments to minimize tax evasion and maximize revenue collection.
No Comments