PERSONAL income tax collections shot up in October following payout of the second and final installment of the Sixth Pay Commission arrears to government employees and pensioners, but corporate tax collections declined over the same month last year, suggesting that the much talked about economic recovery is still to show up in numbers.
However, an I-T official, who did not wish to be identified, said no conclusion should be drawn from the dip. “The Q3 advance tax collections, due by December 15, will indicate a definite trend,” he said.
The Central Board of Direct Taxes had issued an advisory to all central ministries and department to deduct tax on the over Rs 17,000-crore arrear payments. The first installment of the arrears for period from January 1, 2006 to August 31, 2008.
Personal income tax collections were up by 16.1% to Rs 11,398 crore in October 2009. The central tax deducted at source witnessed a growth of 204% to Rs2, 452 crore in October, 2009 as against Rs 800 crore in October, 2008. But, corporate tax collection was at Rs 9,425 crore in October 2009, a 4.72% drop over October 2008 collections.
Overall, direct tax collections grew by 3.92% to Rs 1,73,447 crore in the first seven months of current fiscal. This is almost Rs 2 lakh crore short of the budget target set for the current financial year. A CBDT statement here said the modest growth was largely due to higher tax refunds which rose by 64% in the period to Rs 33,137 crore.
Any encounter with the Income Tax Department is usually dealt with stress and panic. The notice from the Income Tax Department becomes nerve-racking because most of the people More
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