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India’s total tax receipts likely to exceed Budget Estimate in FY24

According to government sources, the strong trend in direct tax and GST collections that is now in place is expected to continue, with the possibility of exceeding the Budget Estimate significantly in the fiscal year 2023–2024.

These estimates, however, are based on preliminary assessments carried out as part of the government’s pre-budget processes. Further information, such as advance tax payments for the third quarter in December and GST revenues from April to December, will be necessary to provide a more accurate forecast. Meanwhile, lawmakers continue to assess tax collection projections for the upcoming fiscal year, 2024–25, when they gather at North Block for pre-budget talks.

In terms of GST, officials anticipate a 13–14% annual increase in revenue, with an approximate monthly average of Rs 1.7–1.8 trillion in 2024–2025. With Rs 1.72 trillion collected in October, it was the second-highest monthly collection after Rs 1.87 trillion in April. For this fiscal year, the average monthly GST revenue falls between Rs 1.6 trillion and Rs 1.65 trillion.

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Tax Numbers to reach very high numbers in 2023-24:

These encouraging numbers, according to a source, are related to a number of policy initiatives and tactics that the revenue department has recently put into place. These initiatives are anticipated to be fully realised in the next fiscal year. When direct and indirect taxes are combined, the gross collection is expected to increase by 10.45% in 2023–2024, reaching Rs 33.61 trillion.

The government has projected that corporate and individual income tax receipts will rise by 10.5% in the current fiscal year, with the goal of reaching Rs 18.23 trillion. Furthermore, it is projected that GST collection will increase by 12% to reach Rs 9.56 trillion. In terms of direct taxes, it is anticipated that in 2023–2024, net collection will increase by 11.1% while gross collection will increase by 10.1% annually. Estimated increases in corporation and personal income tax receipts are 11.7% and 11.4%, respectively. Thanks to increased compliance, data integration, and economic formalization, tax buoyancy—which is greater than economic growth—will continue to exceed an index of 1.

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