Broadly in line with the annual trends as the current growth rate is higher than the required rate, the Centre’s direct tax collection, net of refunds, marked an increase of 16 per cent on a year-on-year (YoY) basis till 15 September 2024. As per the media reports, the government’s direct tax receipts rose to Rs 9.92 lakh crore till the mentioned date.
The collections are in line with the target set for the current financial year as the direct tax receipts till 15 September 2024 were 45 per cent of the FY25 target of Rs 22.07 lakh crore. The required rate of growth to achieve the yearly target was 12.8 per cent, which has been surpassed by the current rate of growth and the collections will likely exceed the target by a decent margin.
On the other hand, the gross direct collections, before refunds, were up by 21 per cent on-year till 15 September as they stood at Rs 11.94 lakh crore. The direct tax refunds increased 65 per cent to Rs 2.02 lakh crore till the same period of the current fiscal year.
As the pace of spending has reported a slowdown despite there being a buoyancy in revenues, the fiscal deficit is likely to be reined below 4.9 per cent of GDP in FY25. As far as the spending is concerned, the second half of 2024-25 is likely to witness an uptick in the spending on the new or revamped schemes such as the Pradhan Mantri Awas Yojana- Gramin (PMAY-G) and Urban. In addition, the schemes for the productisation of Indian technology along with employment-linked incentives to report the same uptick going ahead.
Due to the general elections, there was a slowdown reported in the Centre’s capex which fell by 17.6 per cent in the April to July 2024 period. The revenue expenditure, too, fell by 2.3 per cent during the same period.
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