Sound tax collections cushion govt for Budget 2023 expenditure

As all eyes and ears are fixed on February 1, eagerly awaiting Union Finance Minister Nirmala Sitharaman to lay down in front of the Parliament House, the Union Budget for 2023, the silver lining giving the government the much-desired cushion to deal with expenditures will be the buoyant tax revenue.

To begin with, direct taxes have shown the best growth despite criticism that the budget target last year was too modest or below expectations.

The government had pegged the direct tax collections for the current fiscal at a low of Rs 14.2 lakh crore due to global uncertainties.

Here is a look at how the government has performed so far.

On the direct tax, collections from personal income tax was targeted at Rs 7 lakh crore and as per the official data, till November 2022, the collections were at Rs 4.38 lakh crore, almost 63 percent achieved.

The corporate tax collections too has done well. As against a target of Rs 7.2 lakh crore, the government till November has collected 61 percent of the target, which is around Rs 4.28 lakh crore.

Same is the story with compensation cess, where 69 percent of the estimated Rs 1,20,000 crore has already been credited to the government account in the first 8 months of the fiscal.

But the service tax has been a serious flop, as only 20 percent of the estimated Rs 2,000 crore has been achieved till November.

On the Union excise front, the collections stood at about 51 percent of the estimated Rs 3.35 lakh crore.

And on the customs tax, of the Rs 2.13 lakh crore planned, government has minted a good 66.5 percent of the target at about Rs 1.41 lakh crore.

With such being the tax mop up, it is estimated that the revised estimates to be presented on coming Thursday are likely to be satisfactory but also healthy and could be much beyond the estimates. Let’s see what Finance Minister has to finally present.