InvestorQ : How have the direct tax collections been for the fiscal 2020 and is it likely to reduce in the next fiscal year?
diksha shah made post

How have the direct tax collections been for the fiscal 2020 and is it likely to reduce in the next fiscal year?

Answer
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Mary Joseph answered.
3 months ago


The first signs of revenue pressure are already available in the fiscal year ended March 2020. The direct tax collections for fiscal 2019-20 were lower by 4.92% at Rs.12.33 trillion. This can be attributed to reduced personal tax rates, higher standard deduction and the sharp cut in corporate taxes. CBDT had foregone revenues of Rs.145,000 crore during the year purely on account of the lower rates of taxes and MAT on corporate taxes. We have not even seen the impact of the 15% concessional tax rates offered to new manufacturers. The impact on personal tax collections due to lower tax rates and higher standard deduction was Rs.22,300 crore. But the real impact of the lockdown in April, May and June would only be visible in fiscal 2021. It could only add to the pressure on tax revenues this year.