According to ET, the estimated net tax revenue for the Centre in FY25 is likely to hover around Rs 25-26 lakh crore. In the ongoing fiscal year, the Centre had initially budgeted Rs 23.3 lakh crore for net tax revenue.
Insiders familiar with the details told the financial daily that the revised estimate for net tax revenue in the current fiscal year, after state devolution, is likely to align closely with the initial budget estimate.There may be potential shortfalls in excise duty collections, projected to be around Rs 45,000 crore below the Rs 3.39 lakh crore budgeted target.
For the upcoming fiscal year, the excise duty target is anticipated to be Rs 3 lakh crore. A senior official said that the target for net revenue receipt for the next fiscal year will be modest, ranging between 9-11%. The official attributed this partly to the already elevated base. Over the past two years, tax receipts have exceeded revised estimates.
The government has set its gross tax revenue goal at Rs 33.6 lakh crore for FY24, with state devolution expected to reach Rs 10.2 lakh crore. Following devolution, the Centre’s net tax receipt is anticipated to reach Rs 23.30 lakh crore, marking an 11.7% increase over the revised estimate in FY23.
Some independent assessments forecast a more substantial tax surge, such as Goldman Sachs projecting a 15% growth in income taxes and corporate tax, and an 11% increase in GST for FY25.
The decision to set a modest tax target is seen as providing fiscal flexibility in case collections outperform expectations. The official said it is better to keep it understated considering that the global crisis is far from over.
As of January 10, India’s net direct tax collections had reached Rs 14.7 lakh crore, reflecting a robust growth of 19.4% compared to the same period in FY23. This represents over 80% of the budgeted direct tax target of Rs 18.22 lakh crore.
