I-T refunds in H2 to be up by Rs 50,000-crore

financialexpress.com:

Growth in personal income tax (PIT) collections may slow a bit in the second half of the current financial year from the impressive 31% seen in the first, as the income tax ((I-T) department aims to make tax refunds to the tune of Rs 2 trillion in the remainder of the year, an official source told FE. “The second-half refunds are likely to be higher than in the year-ago period by around Rs 50,000 crore. This would mean that the refunds in the whole of FY24 would be above Rs 3.5 trillion, as against a little over Rs 3 trillion last year,” the source added.

The higher refunds would bring down the growth in gross PIT collections (receipts after refunds but before the mandatory transfers to the states) for FY24 to 17-18%, still significantly higher than the Budget Estimate (BE) of 11.4%. This would mean that the PIT mop-up in the year would be in the vicinity of Rs 9.5 trillion, against the BE of Rs 9.01 trillion.

In April-September this year, PIT collections after refunds stood at Rs 4.52 trillion, accounting for about 50% of the BE FY24. During the first half of last fiscal year, 43% of the annual target was met.

As of October 9 this fiscal, refunds amounting to Rs 1.5 trillion have been issued, as against Rs 1.53 trillion issued in the corresponding period last year. This signals a moderation in the pace of refunds so far in the current year.

In recent years, the department has put the refund process on the fast track, as part of its efforts to boost taxpayer confidence (see chart).

The higher-the-budgeted growth in PIT collections so far in the current year are also the result of several administrative measures undertaken by the department to ensure better tax compliance and detect and curb tax evasion. Of course,