Tax Filings, Refunds See Huge Surge
More Indians filing tax returns and over 58% growth in tax refunds in past three years augurs well for the economy
Photo Credit : PTI,
In what can be considered as a positive sign for the economy, the stupendous growth in the filing of income tax returns and the corresponding growth in income tax collections have also resulted in a surge in IT refunds. The trend is quite evident in the numbers and data put forth by the tax authorities. In the past three financial years, from a total tax refunds of Rs 89,664 crore in 2013-14, so far, the income tax refunds have surged by over 58 per cent to Rs 1.42 lakh crore as on February 10, 2017. For 2014-15, the tax authorities had made a total tax refund to the tune of Rs 1.12 lakh crore.
According to the budget documents, the net tax revenue for 2013-14 was Rs 11.38 lakh crore which grew by 9.4 per cent in 2014-15 and 17 per cent in 2015-16. "As per the revised estimates of 2016-17, we will end the year with a high growth rate of 17 per cent for the second year in a row," finance minister Arun Jaitley had said in his budget speech. He attributed the growth in tax revenue to "the serious efforts made by the government" as it resulted in high growth of advance tax in personal income tax in the first three quarters of the current financial. In April-January, the total direct tax collection grew 10.79 per cent to Rs. 5.82 lakh crore led by robust collections in personal income tax.
In his budget speech on February 1, 2017, finance minister Arun Jaitley had argued how Indians were "largely a tax non-compliant society". He said among the 3.7 crore individuals who filed the tax returns in 2015-16, 99 lakh had shown income below the exemption limit of Rs 2.5 lakh p.a., 1.95 crore showed income between Rs 2.5 to Rs 5 lakh, 52 lakh showed income between Rs 5 - Rs 10 lakhs and only 24 lakh people disclosed their income above Rs 10 lakh. Of the 76 lakh individual assesses who declared income above Rs 5 lakh, 56 lakh were in the salaried class. "The number of people showing income more than Rs 50 lakh in the entire country is only 1.72 lakh. We can contrast this with the fact that in the last five years, more than 1.25 crore cars have been sold, and number of Indian citizens who flew abroad, either for business or tourism, is 2 crore in the year 2015. From all these figures we can conclude that we are largely a tax non-compliant society," Jaitley had said.
Even the corporate side of the story is a dismal one. Of the companies who filed their returns for the Assessment Year 2016-17, there are only 7,781 companies that have shown profit before tax of more than Rs 10 crore. Over 2.7 lakh companies showed losses or income as zero and only 2.8 lakh companies showed profit before tax less than Rs 1 crore.
The data from the finance ministry shows that the Centralised Processing Centre (CPC) of the tax department has already processed over 4.19 crore income tax returns (ITRs), a 20 per cent increase over last year, and issued over 1.62 crore refunds during the current financial year up to February 10, 2017 amounting to Rs 1.42 lakh crore. As much as 92 per cent of the refunds issued are below Rs. 50,000 due to the high priority given to expeditious issue of refunds to small taxpayers. Only 2 per cent of refunds less than Rs. 50,000 remain to be issued. A majority of these cases relate to recently-filed ITRs or where the taxpayer's response to the department is awaited.
The department also advised taxpayers to verify and update their e-mail address and mobile number on the e-filing portal to receive electronic communication.
"CBDT is committed to ensuring best possible taxpayer services through its e-governance programmes and increasing the coverage and scope of electronic filing and processing of various forms and applications," the statement said. As a result of emphasis on expeditious issue of refunds, 92 per cent of all I-T returns were processed within 60 days, demonstrating the Central Board of Direct Taxes' (CBDT) commitment to faster and more efficient taxpayer service.
Around The World