Owing to higher incomes from a booming economy and improved compliance with tax laws, the existing taxpayers are paying more taxes this year, also contributing to the burgeoning direct tax kitty is some addition in the number of new tax payers. In April-October 2007, personal income tax collections of the Centre grew 39.39 per cent at Rs 49,890 crore, significantly higher than Rs 35,805 crore collected in the same period last year. The buoyancy in personal income tax collections can be attributed to both deepening and widening of the tax base, a senior Finance Ministry official said.
Tax experts also emphasise that while salary levels have seen significant rises, avenues for financial savings remain limited at around Rs 1 lakh a year, thus bringing more income to taxation.At the same time, the number of new tax payers has seen a steady increase. In 2004-05, there were 15.97 lakh new assesses and the number went up by 19 lakh in 2005-06 and 21.28 lakh in 2006-07. The direct tax base as on end-March 2007 stood at 3.19 crore assessees, with majority of them coming under the category of ''individuals''. The corporate tax base has been more or less stagnant in the recent years and comprised about 1 per cent of the total direct tax base. Despite this, corporate tax revenues continue to be buoyant, with collections during April-October this year recording 45.71 per cent growth at Rs 78,785 crore (Rs 54,072 crore). The overall direct tax collections for the period under review grew over 40 per cent to Rs 1,28,864 crore, up from Rs 90,180 crore in April-October last year.
Tax experts also emphasise that while salary levels have seen significant rises, avenues for financial savings remain limited at around Rs 1 lakh a year, thus bringing more income to taxation.At the same time, the number of new tax payers has seen a steady increase. In 2004-05, there were 15.97 lakh new assesses and the number went up by 19 lakh in 2005-06 and 21.28 lakh in 2006-07. The direct tax base as on end-March 2007 stood at 3.19 crore assessees, with majority of them coming under the category of ''individuals''. The corporate tax base has been more or less stagnant in the recent years and comprised about 1 per cent of the total direct tax base. Despite this, corporate tax revenues continue to be buoyant, with collections during April-October this year recording 45.71 per cent growth at Rs 78,785 crore (Rs 54,072 crore). The overall direct tax collections for the period under review grew over 40 per cent to Rs 1,28,864 crore, up from Rs 90,180 crore in April-October last year.
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