Banks, oil firms drag advance tax payment in Q2

Suresh P. Iyengar Mumbai | Updated on November 12, 2017


Remittance by Mumbai cos up 5% reveals rate hike, slowdown fears

The advance tax for the September quarter paid by top 100 Mumbai-based companies has recorded a moderate growth of 5 per cent at about Rs 17,224 crore (Rs 16,366 crore) as most banks and oil companies reported a flat growth in their tax payout.

The uncertainty over the lending rate hike cycle and impending slowdown in economy seems to have prompted corporate houses to tighten their purse string.

Mumbai-based companies contribute about 35 per cent of the direct tax collection.

The Finance Ministry recently raised the direct tax collection target for this fiscal by 10 per cent to Rs 5.85 lakh crore. The new tax target is higher by 31 per cent against Rs 4.46 lakh crore collected in FY11.

The net direct tax collections during the July quarter declined 8.1 per cent to Rs 78,679 crore after accounting for tax refunds, which stood at Rs 53,863 crore till July against Rs 19,021 crore in the same period last year.

The Reserve Bank of India will unveil the quarterly policy review on Friday. Most economists are expecting an increase of 25 basis points with no respite from the rising inflation rates. The rate hike, if it happens, will be the 12th in 18 months.

Mr Lal Chand, Additional Commissioner of Income-Tax, said though a clear trend will emerge on Friday, some sectors' numbers have been encouraging, especially steel and private banks, while oil sector has been a cause of concern.

The advance tax payment for the country's largest bank, State Bank of India, for the September quarter was down 14 per cent at Rs 1,650 crore against Rs 1,924 crore remitted in the same quarter last year, according to sources in the income-tax department.

The payout by ICICI Bank was Rs 650 crore (Rs 600 crore) and Bank of India was Rs 260 crore (Rs 250 crore).

Bank of Baroda increased its payment by 56 per cent to Rs 600 crore (Rs 385 crore) while HDFC Bank hiked it by 33 per cent to Rs 800 crore (Rs 600 crore). Citibank India and Standard Chartered Bank upped their outgo by 25 per cent and 10 per cent to Rs 300 crore (Rs 240 crore) and Rs 455 crore (Rs 415 crore), respectively.

Backed by its windfall net profit of Rs 5,600 crore in the June quarter, Reliance Industries' tax outgo rose by 38 per cent to Rs 1,800 crore (Rs 1,300 crore). BPCL's payment plunged to Rs 35 crore (Rs 206 crore) while HPCL's was down at Rs 28 crore (Rs 112 crore).

Among Tata Group companies, Tata Consultancy Services was the star performer as it more than doubled its tax payment to Rs 600 crore (Rs 260 crore). Tata Steel paid 29 per cent higher at Rs 644 crore (Rs 500 crore) and Tata Motors' outgo was unchanged at Rs 90 crore. Tata Chemicals' was at Rs 53 crore (Rs 60 crore) and Tata Power paid Rs 70 crore (Rs 60 crore).

Among insurance majors, LIC enhanced payout marginally to Rs 1,165 crore (Rs 1,067 crore), and GIC at Rs 138 crore (Rs 92 crore). Larsen and Toubro's tax payment was up at Rs 360 crore (Rs 280 crore). Hindustan Zinc paid Rs 425 crore (Rs 175 crore).


The buoyancy in the entertainment sector also increased the tax payments. Salman Khan more than doubled his advance tax payment to Rs 5 crore against Rs 2 crore paid last year. Akshay Kumar paid Rs 5 crore (Rs 4 crore), Shah Rukh Khan maintained his last year's record of Rs 5 crore. Amir Khan's payment was marginally up at Rs 4.5 crore (Rs 4 crore) and Ranbir Kapoor paid Rs 2.5 crore (Rs 2.5 crore).

Published on September 15, 2011

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