Trends in Tax Revenue Collection | 24 Oct 2024

Source: IE

Recently, a recent data released by the Central Board of Direct Taxes (CBDT) under the Ministry of Finance revealed the trends in tax revenue collection for the FY 2023-24.

Direct taxes surged to 56.72% of total revenue in FY24, the highest in 14 years while indirect taxes dropped to 43.28%.
- A Direct tax is imposed directly on the taxpayer and paid directly to the government by the persons (juristic or natural) on whom it is imposed.
- An indirect tax is one collected by an intermediary (like a store) from the person who ultimately pays it (the customer). The taxpayer can pass this tax on to others.
Personal income tax (PIT) (Rs 10.45 lakh crore) was higher than corporate tax (Rs 9.11 lakh crore) collections.
The direct tax-to-GDP ratio climbed to a 20-year high of 6.64%.
Tax buoyancy grew to 2.12 in 2023-24.
- A tax buoyancy above 2 means tax revenues grew more than twice as fast as nominal GDP, reflecting strong tax collection growth.
Top 3 Direct Tax Collection (States): Maharashtra (39%), Karnataka (12%) and Delhi (10.4%).