Tax revenue in 2021-22 exceeds budget estimates by Rs 5 lakh crore
Update: 08 April 2022 17:31 STI
New Delhi [India]Apr 8 (ANI): Tax revenue for the fiscal year ended March 31, 2022 reached Rs 27.07 lakh crore, nearly Rs 5 lakh crore higher than the budget estimate of Rs 22.17 lakh crore for the year, Union Finance Ministry said on Friday.
Tax revenue in 2021-22 is 34% higher than the Rs 20.27 lakh crore recorded in 2020-21. Tax revenue collection is dominated by a 49% increase in revenue from direct taxes. Indirect tax collection increased by 20% year-on-year.
This revenue growth has been propelled by a rapid economic recovery from successive waves of COVID, supported by one of the world’s largest government-run vaccination programs, Revenue Secretary Tarun Bajaj told a conference. press here.
It also means a robust recovery in the economy. These have also been complemented by improved tax compliance efforts. Various efforts have been made by the tax administration on direct and indirect taxes to foster greater compliance through the use of technology and artificial intelligence, he said.
2021-2022 marks the highest tax-to-GDP ratio of 11.7%, with a direct tax-to-GDP ratio of 6.1% and an indirect tax-to-GDP ratio of 5.6%.
Fiscal momentum (which is a measure of tax revenue growth relative to GDP growth) is at a very healthy 1.9, with 2.8 for direct taxes and 1.1 for indirect taxes. The ratio of direct to indirect taxes fell from 0.9 in 2020-21 to 1.1 in 2021-22.
Gross corporate tax in 2021-22 was Rs 8.6 lakh crore compared to Rs 6.5 lakh crore in the previous year, showing that the new simplified tax regime with low rates and no exemptions held its promises.
During the year, the income tax department refunded Rs 2.24 lakh core. Over the past two years, the effort has been to clear the backlog of refunds to inject cash into the hands of businesses. During the year, refunds of 2.4 crore were issued, of which 2.01 crore related to the year 2021-22, for which returns were filed till March 31, 2021.
This was possible thanks to faster processing of returns. In 2021-2022, 22.4% of returns were processed the same day and approximately 75% of returns were processed in less than a month. The average processing time for returns in 2021-2022 was 26 days. During the year, 7.14 crores of returns were filed compared to 6.97 crores last year.
On indirect taxes, the GST experienced exemplary growth in 2021-22 despite two waves of the COVID-19 pandemic. CGST revenue increased from Rs 4.6 lakh crore in 2020-21 to Rs 5.9 lakh crore in 2021-22. The average monthly gross income from GST in 2021-22 was Rs 1.23 lakh crore compared to Rs 94,734 in 2020-21 and Rs 1.01 lakh crore in 2019-20.
This means a robust rebound in the economy. This was complemented by various measures taken to improve compliance. GSTR-3B filing (percentage of prior month returns filed through month end) increased from 74% in September 2020 to 87% in February 2022.
The GSTR-1 filing has improved significantly from 54% in September 2020 to 82% in February 2022. This also shows that the gap between the GSTR-3B filing and the GSTR-1 filing has completely closed in the elimination level. This shows that the GST ecosystem has appreciated the charging-based discipline in GST, which not only benefits GST revenues, but also contributes to the overall formalization of the economy, the Ministry of Finance said in a statement.
The level of economic recovery can also be seen from the value of e-way bills generated each month, which increased from Rs 16.9 lakh crore in January 2021 to Rs 25.7 lakh crore in March 2022.
In 2021-2022, customs duties grew by 48%. Over the past two years, the government has undertaken a comprehensive review and rationalization of the customs tariff structure through extensive consultations and crowdsourcing and has streamlined various exemptions and simplified the tariff structure.
“The recovery trend in the economy and government tax revenue is expected to continue growing,” the ministry said. (ANI)