Moderation in corporate earnings has significantly impacted direct tax collection with gross direct tax mop up growing by just 6.51 per cent during the first five months of the current fiscal.
Gross corporate tax collection increased by an abysmal 0.15 per cent at Rs 96,738 crore during the April-August period as against Rs 96,597 crore last year.
During the five month period,Rs 1,64,413 crore accrued to the exchequer against Rs 1,54,361 crore during the same period last year. The annual tax collection target is 15 per cent.
However,the net direct tax collection was up 28.15 per cent on account of lower refunds. The net direct tax mop up stood at Rs 1,23,969 crore against Rs 96,738 crore during the same period a year ago. In the last five years,of 35.20 crore refunds,20.61 crore have been returned through refund banker scheme. During April-August,refunds issued through the scheme was 33.15 lakh out of 33.51 lakh refunds.
Last year,rise in refunds was huge,mainly after the CAG made adverse remarks about the interest being paid on refunds. This year,they have cleared the back log and therefore the amount refunded is low. We will have to wait for another quarter to read a trend in the direct tax collection, said Amitabh Singh,partner,E&Y.
The collection in personal income tax was up by 17.09 per cent at Rs 67,420 crore as against Rs 57,582 crore during the same period last year.