Demonetisation effect direct tax mop up grows 15% to rs 1 42 lakh cr in q1

Demonetisation effect: Direct tax mop-up grows 15% to Rs 1.42 lakh cr in Q1

Advance tax paid by individuals recorded 40 per cent growth in the first quarter (April-June) of the current financial year.

This could be an impact of the demonetisation of high-value currencies, with more non-corporate entities recording higher incomes.

Overall direct tax collection after refunds expanded by 14.8 per cent to Rs 1.42 lakh crore over the corresponding period in 2016.

“The government has benefited from demonetisation, as people have started reporting higher income,” Sushil Chandra, chairman of the Central Board of Direct Taxes, told Business Standard.

Overall advance taxes, both personal and corporate, grew by 11.9 per cent to Rs 58,783 crore. Advance tax is paid within a specified period after the money is earned, rather than waiting for the end of the financial year.

Electronic filing of income tax returns up to June for 2016-17 grew by 18 per cent, suggesting that more people regularised their unaccounted income. “People are aware now that the income tax department is carrying out lots of searches and surveys and that black money will not be tolerated any more,” said Chandra.

Corporate advance tax collections were up 8.1 per cent. Corporate tax collection, net of refunds, grew by 22 per cent; gross collections grew 4.8 per cent. Refunds, worth Rs 55,520 crore, were 5.2 per cent lower than last year.

“Last year, we cleared a lot of pending refunds for the year-ago period, whereas there are no pending refunds of the past fiscal (year) this time,” said an official

ARTICLE SOURCE – BUSINESS STANDARD