The number of taxpaying entities earning Rs 500 crore or more, which contribute about a quarter of India’s tax collections, has jumped.
Eighty-eight companies paid Rs 1.36 lakh crore in taxes in the year ended March 2015, according to the report released by the taxman. That’s 20 percent more than what 64 such entities – including one individual – paid in the previous year.
The more than 37 percent increase in the number of such taxpayers is impressive though the base is small, said Rajesh Gandhi, partner at Deloitte India.
The government is heavily dependent on this bracket. Hopefully, this dependence will lower as corporate earnings increase and as the government takes steps to broaden the tax base.Rajesh Gandhi, partner at Deloitte India
While the Income Tax Department releases the data more than two years after a financial year ends, it’s an indicator of India’s taxpayers’ profile. The government has since taken a series of measures to widen the base, particularly last year when Prime Minister Narendra Modi outlawed 86 percent of currency in circulation to crack down on unaccounted wealth. A crackdown on dormant firms and high-value cash transactions followed.
The tax base widened in the financial year 2014-15. The number of returns filed jumped 11.5 percent to about 4.35 crore. As a result, total collections from all taxpayers rose 23 percent year-on-year to Rs 5.49 lakh crore, according to the report. The mop-up from individuals fell marginally while companies paid 43 percent more tax.
Apart from the taxpayers who filed returns, about 1.64 crore paid taxes but didn’t file valid or verified returns, the report said.
More Indians In Highest Tax Slab
The number of Indians who earned Rs 10 lakh or more, the highest tax threshold for the category, jumped 14.2 percent during the year to 2.5 lakh taxpayers. However, the total tax paid by them fell 10.5 percent to Rs 77,934 crore during the year.
Overall, individuals filed 4.07 crore, or about 93 percent of the total returns.
Other Key Highlights
- 1.76 lakh individuals earn income above Rs 50 lakh with a total gross income of Rs 2.34 lakh crore.
- 31 individual had gross income between Rs 100 crore and Rs 500 crore.
- Only one individual had a higher gross income at Rs 721 crore.
Salaried
- 95,842 individuals had a salary of more Rs 50 lakh.
- Only five had a salary income of more than Rs 100 crore.
Top Individual Taxpayers
- One person paid a tax of Rs 238 crore.
- Three paid tax of Rs 204 crore with income between Rs 50 crore and Rs 100 crore.
(This article was originally published on BloombergQuint)
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