On 29 April, 2016 the PMO released Income tax data since 2000, and the revelations are not comforting for the economy. This was done in an attempt to establish “transparency & informed decision making”. Following are the highlights of the data provided.
Less than 4% of the total population filed for income-tax returns for the financial year 2014-15. This figure includes the ones who have paid (through TDS), but not yet filed. 54% of this population had zero tax liability.
The data also revealed that 85% of the taxpayers pay less than Rs. 1.5 lakh per annum and only 3 pay over Rs. 100 crore.
A total of Rs. 7.42 lakh crore in direct taxes was collected in the last financial year. That is a whopping figure. However, the growth rate has slowed down from 18% in 2010 to 6.7% in 2015.
There is also an underlying assumption that since the direct tax being paid has increased, the circulation of black money has reduced. But that is not true. The direct tax GDP ratio has reduced from 5.62% in 2013-14 to 5.47% in 2015-16.
This indicates that with the general increase in the average income, the circulation of black money has increased at the same rate, if not more. Not to mention that this has also reduced the GDP growth rate significantly.
In an another revelation, it was found that Maharashtra and Delhi accounted for 53% of direct tax revenues. Although these two places are the biggest corporate jungles, such a massive correlation outlier for a population of 1.3 billion is something. And only 34% of the new PAN cards issued belonged to women.