{"id":259865,"date":"2023-09-13T20:29:37","date_gmt":"2023-09-13T14:59:37","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=259865"},"modified":"2023-09-13T20:29:37","modified_gmt":"2023-09-13T14:59:37","slug":"a-new-direction-for-direct-taxes","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/a-new-direction-for-direct-taxes\/","title":{"rendered":"A new direction for direct taxes"},"content":{"rendered":"\n<p><strong>Source: <\/strong>This post is based on the article<strong> \u201cA new direction for direct taxes\u201d, <\/strong>published in Business Standard<strong>, <\/strong>on <strong>13<sup>th<\/sup> Sep 2023. <\/strong><\/p>\n<p><strong>Syllabus Topic: GS Paper 3 \u2013 Economy \u2013 Mobilisation of Resources<\/strong><\/p>\n<p><strong>News: <\/strong>The latest data shows a decline in the government&#8217;s direct tax collections.<\/p>\n<p>The government&#8217;s direct tax collections declined by 0.91% in the first four months of the current financial year. This is contrary to the Budget&#8217;s projection of 11.36% growth for the full year.<\/p>\n<h2><strong>What are the issues reported in the collection of direct taxes?<\/strong><\/h2>\n<p>First, there is a shortfall in direct tax collections despite healthy profits reported by India Inc. Corporation tax collections fell by 10%.<\/p>\n<p>Second, personal income-tax collections grew by only 6.6%, much lower than the projected annual growth rate of 14%.<\/p>\n<p>Third, The Union Budget for 2023-24 heavily relies on the growth of direct taxes. The shortfall in direct tax collections could jeopardize the government&#8217;s ambitious capital expenditure plan.<\/p>\n<h2><strong>What are possible reasons behind the slowdown in direct tax collections?<\/strong><\/h2>\n<p>Gradual cut in corporation tax rates and lower tax rates for individuals might be affecting collections. The effective tax rate for companies has come down from about 24.67% in 2014-15 to 22% in 2020-21.<\/p>\n<p>Tax concessions offered to individual taxpayers have been rising steadily.<\/p>\n<p>Companies earning over \u20b9500 crore have seen a decline in their effective tax rate from 23% to 19%.<\/p>\n<h2><strong>What should be done?<\/strong><\/h2>\n<p>There is an urgent need to understand why direct tax collections have not reflected the buoyancy in the Indian economy.<\/p>\n<p>The tax department&#8217;s move to send notices to potential tax evaders may not be enough to address the issue.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Source: This post is based on the article \u201cA new direction for direct taxes\u201d, published in Business Standard, on 13th Sep 2023. Syllabus Topic: GS Paper 3 \u2013 Economy \u2013 Mobilisation of Resources News: The latest data shows a decline in the government&#8217;s direct tax collections. The government&#8217;s direct tax collections declined by 0.91% in&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/a-new-direction-for-direct-taxes\/\">Continue reading <span class=\"screen-reader-text\">A new direction for direct taxes<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[10503,216,8184],"class_list":["post-259865","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-business-standard","tag-gs-paper-3","tag-indian-economy","entry"],"jetpack_featured_media_url":"","views":{"total":8,"cached_at":"","cached_date":1698226191},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/259865","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=259865"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/259865\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=259865"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=259865"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=259865"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}