Robust collections to enable govt roll out tax reforms, raise exemption limit

New Delhi, Dec 31: Gross direct tax collections for 2022-23 (up to November 30) were up by 29.66 per cent at Rs 10,93,385 crore, over Rs 8,43,301 crore collected during the corresponding period of the previous year.

With such a surge in tax collections, government would look to unleash reforms in the coming 2023-24 fiscal, especially as far as tax administration is concerned.

Already there are indications that the government may enhance tax exemption limit to Rs 5 lakh per annum from the current Rs 2.5 lakh per annum.

In the near future, sources pointed out that curbing tax evasion is likely to be one of the main agendas for the new fiscal, while there could be stricter taxes on e-commerce entities and online service providers.

With India now having the presidency of G20, digital economy taxation and equal tax distribution among developing economies would be the main focus area in the new year.

Direct as well as indirect tax collections have been robust in 2022, which do give an indication that the economy may revive in the post-pandemic period.

The growth in tax collections has been achieved due to the performance of the economy, administration and implementation of the provisions of the direct tax laws, Finance Ministry sources said.

The Central government has set a target of Rs 14,20,000 crore for the collection of direct taxes as per budget estimates for 2022-23, higher than the actual collections of Rs 14.10 lakh crore in the previous fiscal ending March 31, 2022.

Meanwhile, direct tax collected in the current fiscal till November 30 stood at Rs 8,77,470 crore. Direct tax collections for fiscal 2022-23 are expected to surpass the budget target by at least Rs 1.5 lakh crore, Finance Ministry sources said.

In 2021-22, direct tax collections were Rs 14,12,422 crore. In 2020-21, they stood at Rs 9,47,176 crore and in 2019-20 they were Rs 10,50,681 crore.

In November 2022, Rs 1,45,867 crore gross GST revenues were collected, which were up by 11 per cent year-on-year.

According to official figures, monthly GST revenues have been more than Rs 1.4 lakh crore for nine straight months.

At the same time, revenues from import of goods have been 20 per cent higher and revenues from domestic transaction (including import of services) has been 8 per cent higher than November 2021.

Inflation and increased compliance have helped boost tax receipts, the Finance Ministry has said.