Last Friday, the government announced the net direct tax collection as of 20 December 2018. With an increment of 14% in comparison to the previous collection for the same period a year ago, this year’s collection stands at Rs. 7.36 crores; this makes for 64% of the Budget estimate for direct tax collection this financial year.
“The growth rate of gross direct tax collection and net direct tax collection for the current financial year 2018-19 as on 20.12.2018 is 14.6% and 14.0%, respectively,” the government representative said.
Even the income tax e-returns filed for FY 17-18 are higher than previous years. The e-returns filed this fiscal year stands at Rs. 6.09 crores as of 6 December 2018.
When asked about the effect of demonetization on the collection of direct tax, the government pointed out that the growth of indirect tax revenue was 14.6% in FY 2016-17, 18% in FY 2017-18 and 14% in the current financial year; this is, according to the source, a clear indication of how demonetization has had a positive impact on revenue growth.
The government also pointed out that the stark rise in the number of e-returns filings, in FY17 to FY19, is a reflection of the positive impact demonetization has had on tax compliance by utilising formalisation of the economy.