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According to the Monthly Account of the Government of India upto the month of October, 2024, the Government of India has received Rs 17,23,074 crore (53.7% of corresponding BE 2024-25 of Total Receipts upto October, 2024, comprising Rs 13,04,973 crore Tax Revenue (Net to Centre), Rs 3,99,294 crore of Non-Tax Revenue and Rs 18,807 crore of Non-Debt Capital Receipts. Rs 7,22,976 crore has been transferred to State Governments as Devolution of Share of Taxes by Government of India upto this period which is Rs 1,94,571 crore higher than the previous year. Total Expenditure incurred by Government of India is Rs 24,73,898 crore (51.3% of corresponding BE 2024-25), out of which Rs 20,07,353 crore is on Revenue Account and Rs 4,66,545 crore is on Capital Account. Out of the Total Revenue Expenditure, Rs 5,96,347 crore is on account of Interest Payments and Rs 2,48,670 crore is on account of Major Subsidies. India's fiscal deficit for the first seven months of this fiscal year through stood at 7.51 lakh crore rupees, or 46.5% of annual estimates. The fiscal deficit was around 45% reported in the comparable year-earlier period.
Gross direct tax collections hit Rs 15.02 lakh crore
The Central Board of Direct Taxes (CBDT) has reported that overall tax collection from April 1 to November 10 grew by 15.41% to Rs 12.1 lakh crore, including net corporate tax collections of Rs 5.10 lakh crore and non-corporate taxes, such as Rs 6.62 lakh crore paid by individuals, HUFs, and firms. A total of Rs 35,923 crore was collected from other taxes, including the Equalisation Levy and gift tax. The CBDT reported that gross direct tax collections hit Rs 15.02 lakh crore, marking a 21.20% increase compared to the same period last year. The board stated that refunds totaling Rs 2.92 lakh crore were issued during this period, marking a 53% increase over the same period last year. After accounting for these refunds, net direct tax collection—which includes corporate, non-corporate, and other taxes—showed a 15.41% increase, up from Rs 10.49 lakh crore collected during the same period in the previous financial year.
GST collection rises 8.5% in November
Gross GST collections grew 8.5% to over Rs 1.82 lakh crore in November on account of increased sales spurred by the festive season, according to official data. The Central GST collection stood at Rs 34,141 crore, State GST at Rs 43,047 crore, Integrated IGST (Rs 91,828 crore) and cess (Rs 13,253 crore), according to government data released on Sunday. The highest-ever GST collection of Rs 2.1 lakh crore was reported in April.
India removes windfall profit tax on domestically-produced crude oil and fuel exports
The Centre has removed the windfall profit tax on domestically-produced crude oil and fuel exports, according to media reports. Minister of State for finance Pankaj Chaudhary reportedly tabled a notification in the Rajya Sabha about the decision of removing tax on crude oil. The notification cancelled the June 30, 2022 order and removed the special additional excise duty (SAED) on crude oil production and fuel exports, including aviation turbine fuel (ATF), diesel and petrol. The government also withdrew the road and infrastructure cess (RIC) previously imposed on petrol and diesel exports.
Outlook:
While the quarterly Gross Domestic Product or GDP growth fell to multi quarter low in Q2FY25, overall economic undertone appears steady for India. This is also being corroborated by the latest action of the Reserve Bank of India or RBI as it announced its fifth bi-monthly monetary policy of FY25 in first week of December 2024. The central bank decided to keep the benchmark repo rate unchanged at 6.5% for the eleventh straight meeting, and maintain the monetary policy stance ‘Neutral’. Latest GDP data showed that government Final Consumption Expenditure (GFCE) has rebounded to a growth rate of 4.4% after observing either negative or low growth rates in previous three quarters. It will be interesting to see how this shapes up ahead of the release of the Union Budget for next fiscal year.
The sustained push in economic reforms over last few years is triggering accelerated formalization in all sectors. This is a beneficial factor for government revenue and business environment. Ministry of Labour & Employment stated in a latest update that India’s economy is currently undergoing a transformative shift marked by an increasing trend toward formalization—a process that is redefining job structures, employment security, and social benefits for millions. This change is of profound importance for India’s workforce, as it ensures that a larger segment of the population is covered by social security systems, offering them greater economic stability and a more secure future. According to the data provided by EPFO, since September 2017 to July 2024, over 6.91 crore members have joined EPFO. This means that nearly 7 crore people have transitioned to more secure, formal jobs. The trend reflects India's push towards formalizing its workforce, leading to better job security for employees. In the fiscal year 2022-23, 1.38 crore new members joined EPFO. From April to July 2024, the monthly registrations have been steadily increasing, with nearly 20 lakh new members added in July alone.
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