E-Paper
Net direct tax kitty grows 16% on corporate refunds
Gross direct tax collection in 2024-25 (as on December 17) saw 20.32% year-on-year jump to ₹19.21 lakh crore
Gross direct tax collection in 2024-25 (as on December 17) saw 20.32% year-on-year jump to ₹19.21 lakh crore, but net collection in the period saw 16.45% increase at ₹15.82 lakh crore on higher refunds of ₹3.39 lakh crore, particularly on account of corporates, government data said.
Gross corporate tax (CT) collection in the current financial year (as on December 17, 2024) posted 16.92% annualised growth to ₹9,24,693 crore, but net saw only 8.57% year-on-year increase because of higher refunds. Refunds to corporates jumped 70.32% to ₹1,82,086 crore as compared to ₹1,06,904 crore in FY24 (as on December 17, 2023), according to data released on Wednesday.
Gross non-corporate tax (NCT), which mainly includes individual income-tax revenues, posted little over 22% jump to ₹9,53,871 crore in FY25 (up to December 17) as compared to ₹7,81,737 crore in the same period last year. The income-tax department has reclassified person income-tax or individual income-tax as NCT by clubbing with other minor heads, including taxes paid by entities such as local authorities and artificial juridical person.
With ₹1,56,792 crore refunds in the current period -- about 19.78% increase as compared to ₹1,30,901 crore last year – the net NCT (largely comprising tax collected from individuals) up to December 17 of FY25 was ₹7,97,080 crore with 22.47% jump.
As defined by the government, a direct tax is a kind of charge that is imposed directly on the taxpayer and paid directly to the government by the persons (juristic or natural) on whom it is imposed. It cannot be shifted by the taxpayer to someone else. However, an indirect tax is a tax collected by an intermediary (such as a retail store) from the person who bears the ultimate economic burden of the tax (such as the customer). An indirect tax is one that can be shifted by the taxpayer to someone else.
Comparative data showed direct tax growth rate is stronger as compared to indirect tax (goods and services tax or GST). According to data released on December 1, GST revenue in the month of November saw a single digit growth. Gross GST revenue collection in November increased by 8.5% to ₹1,82,269 crore compared to ₹1,67,929 crore collected in the same month of previous year, while the net collection after refunds saw 11.1% jump at ₹1,63,010 crore as against ₹1,46,786 crore. According to the latest GST data, cumulative revenues in eight months of FY25 increased by 9.3% on an annualised basis to ₹14,56,711 crore. The net collections in April-November 2024 saw a single-digit annualised growth at 9.2% ₹12,90,616 crore.
The historical data show that the share of direct taxes in total tax revenue have gradually increased and it surpassed the indirect tax since 2007-08, when its share in total tax kitty rose to 52.97%. It, however, fell below 50% twice in the last 10 years – in 2016-17 (49.65%) and in 2020-21 (46.84%). In 2023-24, it was 56.72%.
