Central Board of Direct Taxes (CBDT), the apex body that administers corporate and personal income-tax, expects a 10-15% year-on-year increase in collections by December 15, the last date for paying the third installment of advance tax, according to CBDT chairman SSN Moorthy. Mr Moorthy, who was in Mumbai on Monday for a review meeting of the department, said the trend so far suggested a high rate of increase in tax collection by December 15.
The rate of increase in tax collection in the fiscal year through November was a tad over 2% from the corresponding period last fiscal (FY09).
This is the first positive indication by CBDT of a yearly increase in tax collections since December 2008. Collection in the first nine months of the previous fiscal fell for the first time in four years.
However, the nearly 8% increase in the second-quarter GDP and reports that revenue authorities get from industries are compelling reasons for forecasting a 10-15% increase in tax collection, senior I-T officials have said.
The mopup by December 15 gives a clear account of the possible collection by the fiscal year-end as 75% of advance tax collections are paid in the third installment.
The trend of declining collections, which began last December, continued till the end of fiscal 2008-2009, which saw a gap of about Rs 60,000 crore between projected (Rs 3,95,000 crore) and actual collections.
The dramatic increase in GDP during the September quarter helped dispel apprehensions of a possible repeat of dismal collections in the current fiscal.
Total collection, including corporate and individual taxes until November 30, stood at Rs 1.84 lakh crore against the corresponding figure of Rs 80,114.9 crore in FY09. In the fiscal year to November, corporate tax collection accounted for Rs 1.15 lakh crore, marking a year-on-year increase of 3.5%.