Advance tax collection up by 52% yoy

Advance tax collection up by 52% yoy

Advance tax collection increased by 52% year on year during Q2 FY22, reaching Rs. 1.72 lakh crore. Mining, manufacturing, and steel are some sectors which contributed to the robust performance. In comparison to FY 20, the advance tax collections is up by 21%. Tarun Bajaj, revenue secretary, said, “The sectors that have done well in advance taxes (up to Q2FY22) include steel, manufacturing, mining. Steel is doing even better than FY20, so is pharmaceuticals, wholesale trade and financial services.”

Commenting on higher tax revenue growth than the overall economic performance, Bajaj commented combination of several factors including greater formalization and improved compliance are giving a boost to revenues. Personal income in the country increased by 62% yoy, reaching Rs 2.88 lakh crore till September 23 FY 22. This indicate better compliance owing to use of technology and goods and services tax (GST) data.

Another official said net tax collections of central government could exceed budget target in FY 22 by about Rs 2 lakh crore. Thus, the tax collection might covering the additional fiscal cost of stimulus measures that has been announced.