The Centre beat all its estimates of revenue collection in the financial year ended on March 31, aided by better indirect tax mop-up, strict compliance measures, and recovery in most sectors following the successive waves of the Covid-19 pandemic.
India’s gross revenue collection soared to a record high of Rs 27.07 trillion in FY22, while the tax-to-GDP ratio jumped to an over two-decade high of 11.7 per cent, the finance ministry said on Friday. The total mop-up was 34 per cent more than the Rs 20.27 trillion collected in FY21.
“It signifies a robust recovery in the economy. This was also supplemented with better compliance efforts in taxation. Various efforts were taken by the tax administration on direct as well indirect taxes to nudge higher compliance through the use of technology and artificial intelligence,” the ministry said.
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Direct taxes, which comprise income tax paid by individuals and corporate tax, came in at Rs 14.10 lakh crore — Rs 3.02 lakh crore higher than the budget estimate. Indirect taxes like excise duty stood Rs 1.88 lakh crore higher than the budget estimate. Against the budget estimate of Rs 11.02 lakh crore, indirect tax mop-up was Rs 12.90 lakh crore, he said.
While direct taxes showed a 49 per cent growth, indirect tax collections were up 30 per cent last fiscal, he added.
According to CBIC Chairman Vivek Johri, customs duty collections included major contributions from items like gold, edible oil, mobile phones and motor vehicles. Infrastructure items such as iron, steel, cement have also afforded good GST revenue to the government, along with revenue from the IT sector, he said.
“We are expecting the gross tax revenue in 2022-23 to be in the range of Rs 29.8 lakh crore to Rs 30 lakh crore. However, with corresponding increase in devolution to states by about Rs 70,000 crore and estimates of food and fertilizer subsidy set to rise by about Rs 1.3 lakh crore-1.5 lakh crore, the evolving revenue scenario of the central government for the current year is seen to be in balance, leaving no room for complacency for now,” Siddharth Kothari, economist at Sunidhi Securities, said.
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