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Finance Ministry on Friday said that tax collections during Fiscal Year 2021-22 has crossed ₹27 lakh crore. This is ₹5 lakh crore more than Budget Estimates of ₹22 lakh crore and around 34 per cent more than in Fiscal Year 2020-21.
However, the Ministry does have apprehensions about collections in current fiscal because of the situation arising out of Ukraine-Russia conflict.
“A lot of technology is being used where GST figures are now being matched with Income Tax figures and compliances are being ensured. So, all these have resulted in better compliance and revenues both in direct and indirect taxes. To say that a similar growth would happen next year it won’t be correct picture,” Revenue Secretary Tarun Bajaj said.
Direct taxes came in at ₹14.10 lakh crore, a growth of 49 per cent over last fiscal, which Bajaj said was perhaps the highest growth rate in “long time”.
The corporate taxes grew 56.1 per cent to ₹8.58 lakh crore, while personal income tax grew 43 per cent to about ₹7.49 lakh crore. In indirect taxes, while Customs collection zoomed 48 per cent to over ₹1.99 lakh crore, CGST and cess collection was up 30 per cent at ₹6.95 lakh crore. Excise mop up, however, dipped 0.2 per cent to ₹3.90 lakh crore during the 2021-22 fiscal. Overall, indirect taxes grew 20 per cent to ₹12.90 lakh crore.
“Direct taxes are more than indirect taxes (in 2021-22) and I hope this trend will continue in the coming years,” Bajaj said.
Tax Compliance and administration
Bajaj said that compliance has improved and so as administration. For direct taxes, more than 7.14 crore ITRs (Income Tax Returns) filed for the Assessment Year 2021-22 (Fiscal Year 2020-21) as on March 31, 2022, an increase of 2.4 per cent compared to 6.97 crore ITRs filed for AY 20-21 (FY 2019-20) till May 31, 2021. Overall, average processing time for AY 21-22 was 26 days, however almost every fifth ITR was processed on the same day, when it was verified.
In terms of GST, lot of improvement has been seen in terms of filing of returns. Percentage of assesses filing GSTR 1 at the end of month rose from 54 per cent in September 2020 to 82 per cent in February this year. Similarly, GSTR3B filing surged to 87 per cent in February from 74 per cent in September 2020.
Bajaj said that higher number of assesses filing both the returns helped in curbing to fake invoices in a big way.
Tax Buoyancy and Tax-GDP ratio
Overall Tax buoyancy, scale to compare growth rate of tax collection with nominal growth rate of GDP, has gone 1.91, which is higher than normal. In terms of direct tax, tax buoyancy is 2.8 while for indirect tax it is 1.13 per cent.
Bajaj also said that the tax-to-GDP ratio jumped to 11.7 per cent — the highest since 1999. It was 10.3 per cent in fiscal year 2020-21
Tax Collection’
(In ₹lakh crore)
| 2017-18 | 2018-19 | 2019-20 | 2020-21 | 2021-22 | Growth (in %) | |
|---|---|---|---|---|---|---|
| Direct Taxes | 10.02 | 11.37 | 10.50 | 9.45 | 14.10 | 49 |
| Indirect Taxes | 9.12 | 9.37 | 9.54 | 10.77 | 12.90 | 20 |
| Other Taxes | 0.05 | 0.06 | 0.07 | 0.05 | 0.07 | |
| Total Gross Tax | 19.19 | 20.80 | 20.10 | 20.27 | 27.07 | 34 |
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