
India’s direct tax collections have experienced significant and sustained growth over time. The gross direct tax collection for the financial year 2023-24 (as of March 17, 2024) registered an increase of 18.7% compared to the corresponding period of the previous year (2022-23). The gross collection of direct taxes for the financial year 2023-24 stands at Rs. 22.2 lakh crore, which includes Corporation Tax (CIT) at Rs. 10.9 lakh crore and Personal Income Tax (PIT) including Securities Transaction Tax (STT) at Rs. 11.2 lakh crore.
Direct taxes are levied on the taxable income earned by individuals and corporate entities. Some of the key direct taxes include income tax, corporate tax, capital gains tax, and property tax. The significant increase in direct tax revenue can be attributed to initiatives such as demonetization (2016), the Income Disclosure Scheme (2016), and the e-verification scheme (2021), which have played a key role in broadening the tax base.
The digitalization of tax assessment processes has also contributed to the growth of direct tax collections. It has reduced the cost of tax collection and enabled small and medium taxpayers to obtain their tax refunds promptly and with greater ease, fostering increased compliance.
In addition to direct taxes, India’s indirect tax collections, particularly the Goods and Services Tax (GST) revenue, have also shown resilient and robust growth. The gross GST revenue for February 2024 surged to Rs. 1.68 lakh crore, marking a 12.5% increase compared to the corresponding month in 2023.
Overall, the growth in both direct and indirect tax collections reflects India’s strong recovery post-pandemic and the resilience of its economy. These collections not only indicate economic progress but also serve as a barometer of the country’s potential and stability.