The advance tax collections of the Centre for the third quarter (April-December) of FY24 have increased by 19.8% from the previous year, reaching ₹6.24 lakh crore, according to news reports. The data includes payments made until 11:30 pm on December 15, which was the final day for the third quarter's advance tax payment.
A senior official told Economic Times that the final figures might increase on Monday once additional data from the banks is received. The ultimate collection data will be unveiled next week.
The aforementioned official stated that out of the total amount, ₹4.81 lakh crore was attributable to corporate tax, whereas personal income tax made a contribution of ₹1.42 lakh crore.
Responding to the news analysts say that the significant increase in advance tax collections indicates the continuation of economic growth momentum in the initial phase of this quarter.
In the FY24 budget, the Centre has estimated ₹18.20 lakh crore for direct taxes, indicating a 9.6% increase from the most recent estimate for FY23. The previous fiscal year (FY23) had a budget estimate (BE) for direct tax revenue of ₹14.2 lakh crore. This figure was subsequently revised to ₹16.5 lakh crore and concluded slightly above at ₹16.61 lakh crore.
Analysts anticipate that the direct tax collections will exceed the budget estimates.
The Reserve Bank of India (RBI) increased its Gross Domestic Product (GDP) prediction for the fiscal year 2024 to 7% last week, up from the previously estimated 6.5%. This adjustment was made following an unexpected economic expansion of 7.6% in the quarter ending September.
Analysts also say that the strong progress in tax collections signifies solid corporate earnings. The tax collections, which have exceeded budget expectations, will provide the government with the flexibility needed to achieve its fiscal deficit goal for FY24, set at 5.9% of GDP.
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