Income Tax collection in FY24 is going to beat budget estimates. It is projected to cross 9,50,000 Crores (9.5 Trillion INR).
But that is just half the story.
What the government is not telling you is that the refunds are going to increase too.
It is estimated that the refunds will be around 3,50,000 Crores.
Thus the net receipts are going to be just 6,00,000 Crores. Although higher than previous year, they are nowhere close to the figure that Modi Sarkar is telling to the world.
This figure is for Personal Income Tax.
Since the last couple of years, Personal Income Tax has exceeded Corporate Income Tax. This has happened because Modi Sarkar has reduced the rate of taxes on Corporate Income. The rates have been reduced by almost 9%, from 33% it is now at 24%.
The reason given for this reduction is that corporate entities create jobs and if they have more money with them, they can do more investments and thus create more jobs.
The reality is something different. The rich are not interested in creating jobs, especially in an economy that is largely stagnant. This is a global trend, the rich have successfully lobbied governments across the world to reduce taxes on them and as they are financing the politicians, the politicians have obliged.
The result is the gap in taxes is being filled through taxing anything that moves. For FY24, the Government has a budget of 45,00,000 Crores and with about 11,00,000 Crores coming from Personal and Corporate Income Tax, rest of the gap is being filled through receipts of indirect taxes (GST) and borrowing from the market.
The basic fact that the masses drive the economy and absence of jobs and income sources with the masses will ruin any economy is being given a miss.
Consequences will naturally follow.
