India's gross direct tax receipts grew a modest 7.14% during the April-November period to R3,25,696 crore as high cost of borrowing and economic slowdown affected corporate profits.
Data released by the finance ministry on Tuesday showed there has been a 15.04% jump in net direct tax receipts to R2,70,731 crore, suggesting lesser refunds during the period from a year ago. Net direct tax collected in the eight months of the fiscal is less than half of the budgeted target of R5.6 lakh crore.
That paints a grim situation with respect to government's financial health considering fiscal deficit in the April-October period had reached 71.6% of the budgeted level and 20% above the level seen in the same period last year. Policy makers believe the situation will improve in the coming months on account of improvements in tax receipts and a not so crippling subsidy outgo as in the first half.
The latest figures also said gross corporate tax receipts grew by 3% in the first eight months of the fiscal to R2,05,301 crore compared to a year ago. Gross personal income tax jumped 14.94% in the period under review to R19,736 crore.
Net wealth tax collection rose by 27.10% to R619 crore during the April-November period, while securities transaction tax (STT) collections shrank by 12.83% to R2,914 crore. Tax collection figure falling below estimate is not surprising considering the sluggish 5.3% economic growth in the second quarter and the 0.1% growth in industrial output in the April-September period.