Direct Tax Collections Up 38% In April-Aug - 4 Sep 08

Belying fears of an economic slowdown, direct tax collections have gone up by 38.3 per cent in the first five months of the current fiscal at Rs 84,409 crore, compared to Rs 61,030 crore in a year-ago period. The corporate taxes rose by 43.49 per cent to Rs 48,450 crore, against Rs 33,766 crore, while Personal Income Tax (including FBT, STT and BCTT) grew by 31.79 per cent to Rs 35,840 crore, an official release said. Amids volatility in stock markets, securities transaction tax registered a 15.10 per cent growth at Rs 2,730 crore during the period.

Fringe Benefit Tax (FBT) rose by 31.85 per cent to Rs 1,339 crore. However, Banking Cash Transaction Tax (BCTT) posted a negative growth of 21.36 per cent at Rs 274 crore against Rs 348 crore. BCTT was never taken as a revenue generating measure, but was imposed to keep a track of black money generation. Analysts said robust tax collections are expected to help the government maintain fiscal deficit at 2.5 per cent during 2008-09 despite increase in expenditure in the election year.

Finance Minister P Chidambaram has reiterated on several occasions that the Budget deficit targets would be adhered to. Among regions, tax growth in Delhi and Mumbai was 76.23 per cent and 32.49 per cent, respectively. Other regions with high tax growth are Nagpur (88.75 per cent); Kochi (58.07 per cent); Kolkata (56.82 per cent); Bhubaneshwar (53.59 per cent) and Bangaluru (48.87 per cent).