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Net Direct Tax Collections Exceed 2023-24 Target Syllabus:

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Context

  • India’s net direct tax collections grew 17.7% in 2023-24 to hit 19.58 lakh crore.

About

  • The Budget Estimates (BE) for Direct Tax revenue in the Union Budget for FY 2023- 24 were fixed at Rs. 18.23 lakh crore which were revised and the Revised Estimates (RE) were fixed at Rs. 19.45 lakh crore.
  • The provisional Direct Tax collections (net of the refunds) have exceeded the BE by 7.40% and RE by 0.67%.

Direct Tax collection

  • The Net collections (provisional) of Direct Tax collections for the FY 2023-24 show that Net collections are at Rs. 19.58 lakh crore, compared to Rs. 16.64 lakh crore in the preceding Financial Year i.e. FY 2022-23, representing an increase of 17.70%.
  • The Gross collection (provisional) of Direct Taxes (before adjusting for refunds) for the FY 2023-24 stands at Rs. 23.37 lakh crore showing a growth of 18.48% over the gross collection of Rs. 19.72 lakh crore in FY 2022-23.

 Corporate Tax

  • The Gross Corporate Tax collection (provisional) in FY 2023-24 is at Rs. 11.32 lakh crore and has shown a growth of 13.06% over the gross corporate tax collection of Rs. 10 lakh crore of the preceding year.
  • The Net Corporate Tax collection (provisional) in FY 2023- 24 is at Rs. 9.11 lakh crore and has shown a growth of 10.26% over the net corporate tax collection of Rs. 8.26 lakh crore of the preceding year.

Personal Income Tax

  • The Gross Personal Income Tax collection (including STT) (provisional) in FY 2023- 24 is at Rs. 12.01 lakh crore and has shown a growth of 24.26% over the Gross Personal Income Tax collection (including STT) of Rs. 9.67 lakh crore of the preceding year.
  • The Net Personal Income Tax collection (including STT) (provisional) in FY 2023-24 is at Rs. 10.44 lakh crore and has shown a growth of 25.23% over the Net Personal Income Tax collection (including STT) of Rs. 8.33 lakh crore of the preceding year.
  • Refunds of Rs. 3.79 lakh crore have been issued in the FY 2023-24 showing an increase of 22.74% over the refunds of Rs. 3.09 lakh crore issued in FY 2022-23.

 

What is Direct Taxes?

–       Direct taxes are imposed on the basis of individuals ability to pay principle, which says that those individuals or entities having access to more resources and earning a higher income need to pay higher taxes.

–       The direct rules are framed such that taxes turn out to be a method to redistribute money in the country.

Types of Direct Taxes

–       Estate Tax: It is also called Inheritance Tax and is paid based on the value of the estate or the money that an individual has left after his/her death.

–       Income tax: It is a tax charged on the annual income of an individual or business earned in a financial year.

–       Wealth Tax: The tax must be paid on a yearly basis and depends on the ownership of properties and the market value of the property.

–       Corporate Tax: A corporate tax is a tax on the profits or net income of a corporation. a. Corporate tax is paid on a company’s taxable income which includes company’s revenue after deductions such as cost of goods sold (COGS), general and administrative (G&A) expenses, selling and marketing, depreciation, research & development etc.

 

–       Capital Gains Tax: It is a form of direct tax that is paid due to the income that is earned from the sale of assets or investments. Investments in farms, bonds, shares, businesses, art, and home come under capital assets.