Higher Tax Collection Due To Economic Recovery, Better Compliance, Says Government
Net indirect taxes have risen 9.4% and net direct taxes have seen a 41.3% increase over the year earlier during April-June period.
The government's tax collection has increased because of economic recovery and on better compliance measures.
India’s indirect tax collection rose 9.4%, while direct tax jumped 41.3% year-on-year during the April-June period, Pankaj Chaudhary, minister of state for finance, said in a reply to a question in the Lok Sabha.
"Various factors like rapid economic recovery post-Covid, better compliances due to various measures taken by government have contributed to this increase," Chaudhary said in his response to whether domestic tax collections were dented by inflation and higher imports.
The country’s cumulative net direct tax mop-up stood at Rs 3.39 lakh crore for April-June, BQ Prime had reported on June 16. The revised figures for the quarter stand at Rs 3.54 lakh crore. Net direct-tax collection includes personal and corporate tax.
Indirect tax registered a modest increase comparatively, finishing at Rs 3.4 lakh crore for the first quarter of FY23. Net indirect tax is a cumulative of custom duties, union excise duty, service tax arrears, and goods and services tax.
The minister also credited the various steps taken by the government to improve compliance. They are:
Mandating e-invoicing on all registered persons having an aggregate turnover of more than Rs 20 crore from April 1, 2022. Earlier the threshold limit was Rs 500 crore.
Shifting tax liabilities on e-commerce restaurant operators. From Jan. 1, 2020, online food delivery platforms such as Swiggy and Zomato have been paying 5 % goods and services tax.
Registered person will not be allowed to furnish the return for a tax period if previous year's return are not filed.
Efforts towards auto population of details on the portal to calculate tax liability, input-tax credit, calculation of distance based on the pin code in e-waybill, and interest calculation for delayed payments, among others.