For the first time in 20 years, direct tax collection will decline

Mumbai, Ta. January 24, 2020, Friday

Direct tax collections are likely to decline for the first time in the last 20 years in the current fiscal year following a slowdown in the economy and a reduction in corporate tax last year, Reuters reported in a report.

The Prime Minister Modi government has set a target of 13.5 lakh crore direct tax collections in the negative year ending March 31. Which is 17% more than the previous financial year.

However, the economic downturn has forced companies to cut investment and jobs. Due to this tax collection, the country's GDP is also decreasing. The government has projected GDP at 5% for the current fiscal. Which is the lowest in the last 11 years.

As of January 23, the tax department has been able to collect only Rs 7.3 lakh crore tax. This is 5.5 percent less than the same period last year. If you look at the last three years, 30 to 35 percent of the annual tax is deposited in the last three months of the financial year.

However, according to the eight senior officials of the Income Tax department, the tax collection in the current financial year will be less than last year's tax collection of Rs 11.5 lakh crore, despite the efforts made. Officials further said that forgetting the target of the current financial year, this time tax collection will be less than last year and this reduction will be seen for the first time in the last 20 years.

According to him, direct tax collection is likely to be 10 percent less than last year in the current financial year. It is worth mentioning that Direct Tax Collection belongs to 80% of the Government's income ie reduction of Direct Tax Collection will also reduce the revenue of the Government.

The tax collection is likely to see a reduction in corporate tax cuts last year to boost production and investment in Asia's third-largest economy, officials said. We will be happy if the tax collection in the current financial year is the same as last year.