NEW DELHI: In a first in recent historical past of tax filings, income tax e-filings in FY2019 have dropped by more than 6.6 lakh, a trend that analysts said was once unexpected as tax base was once expected to extend submit demonetisation.
According to statistical data put out on Income Tax Department's e-filing site, income tax e-filings in FY 2018-19 was once 6.68 crore, down from 6.74 crore in the previous fiscal.
E-filers in FY 2016-17 had been five.28 crore.
Kotak Economic Research in an April 30 report said: "We are surprised with the decline in income tax e-filing in FY2019."
"If the filings are indeed plateauing, it will be a worry for the fiscal which has seemingly shifted its focus to compensatory expenditure," it said. "Tax filings have surprisingly plateaued in FY2019. This is surprising given that post demonetisation it was expected that the tax base would continue to increase."
However, registered filers were on the upward push - they grew by 15 in step with cent to 8.45 crore as on March 31, 2019, the e-filing site showed.
Registered filers had been just 2.7 crore at the finish of March 2013 which just about doubled to 5.2 crore in March 2016 and to six.2 crore in March 2017.
In indicators of decrease compliance, the ratio of exact filings to registered filers was once 79 in step with cent in FY2018-19, down from 91.6 in step with cent in the previous fiscal. The compliance ratio was once 85 in step with cent and 83 in step with cent in the previous two years. It was once 79.3 in step with cent in FY2014-15, which was once a decline from 82 in step with cent of FY2013-14.
The knowledge showed a gentle upward thrust in filers in the Rs five lakh to Rs 10 lakh vary with 1.05 crore filings in FY2018-19 together with 1.02 crore of particular person taxpayers.
Kotak said the declining e-filings "does beg the question whether compliance was weaker in the latter part of FY2019 given that the number of registered filers has continued to see steady growth."
"If compliance has been weak, the new government will aim at increasing the filings and collections in FY2020," it said. "A focused utilization of the data on deposits during demonetization could yield better compliance, especially in the higher income brackets."
This combined with the granular GST filing knowledge can be crucial in expanding the filings as well as revenues over the following few years, it said. "The task is cut out for the next government looking at improving the tax buoyancy -- essential to fund the increasing transfers in expenditure."
The executive needs to have a look at additional increasing the tax base (optimally the use of the data repository from demonetization and GST). Without an important development in the tax base, the medium-term expansion path can be at risk, Kotak said.
It said that whilst it's hoped that the filings for the evaluate year building up (round August when filings are completed), a somewhat muted tax filing expansion will create additional headwinds in an already stressed out fiscal house.
"With the recent inception of direct transfers in the budget, the fiscal could easily be on a slippery slope unless there is a rationalization of expenditure," it said including round 55 in step with cent of central executive expenditure is mounted in nature and the eventual impact might be on additional decreasing capex.
Given the stressed out fiscal house, debt markets are pressured with heavy executive and PSE borrowings, which are likely to keep the yield curve steep in FY2020, it added.
Kotak said whilst various task indicators were signalling a slowdown in portions of the economic system, the tax collections corroborate it too.
"Aggregate indirect tax revenues' buoyancy has been weak along with targets being missed on direct taxes too. Further, persistently high borrowing cost for financial institutions and companies (given crowding out by the government sector) will weigh on the near-term aggregate demand in the economy," it said.
From a medium-term point of view, if the federal government does no longer increase its capital expenditure (upper transfers and muted tax expansion), the expansion potentialities can be underneath doubt given estimated fiscal multipliers, it added.
According to statistical data put out on Income Tax Department's e-filing site, income tax e-filings in FY 2018-19 was once 6.68 crore, down from 6.74 crore in the previous fiscal.
E-filers in FY 2016-17 had been five.28 crore.
Kotak Economic Research in an April 30 report said: "We are surprised with the decline in income tax e-filing in FY2019."
"If the filings are indeed plateauing, it will be a worry for the fiscal which has seemingly shifted its focus to compensatory expenditure," it said. "Tax filings have surprisingly plateaued in FY2019. This is surprising given that post demonetisation it was expected that the tax base would continue to increase."
However, registered filers were on the upward push - they grew by 15 in step with cent to 8.45 crore as on March 31, 2019, the e-filing site showed.
Registered filers had been just 2.7 crore at the finish of March 2013 which just about doubled to 5.2 crore in March 2016 and to six.2 crore in March 2017.
In indicators of decrease compliance, the ratio of exact filings to registered filers was once 79 in step with cent in FY2018-19, down from 91.6 in step with cent in the previous fiscal. The compliance ratio was once 85 in step with cent and 83 in step with cent in the previous two years. It was once 79.3 in step with cent in FY2014-15, which was once a decline from 82 in step with cent of FY2013-14.
The knowledge showed a gentle upward thrust in filers in the Rs five lakh to Rs 10 lakh vary with 1.05 crore filings in FY2018-19 together with 1.02 crore of particular person taxpayers.
Kotak said the declining e-filings "does beg the question whether compliance was weaker in the latter part of FY2019 given that the number of registered filers has continued to see steady growth."
"If compliance has been weak, the new government will aim at increasing the filings and collections in FY2020," it said. "A focused utilization of the data on deposits during demonetization could yield better compliance, especially in the higher income brackets."
This combined with the granular GST filing knowledge can be crucial in expanding the filings as well as revenues over the following few years, it said. "The task is cut out for the next government looking at improving the tax buoyancy -- essential to fund the increasing transfers in expenditure."
The executive needs to have a look at additional increasing the tax base (optimally the use of the data repository from demonetization and GST). Without an important development in the tax base, the medium-term expansion path can be at risk, Kotak said.
It said that whilst it's hoped that the filings for the evaluate year building up (round August when filings are completed), a somewhat muted tax filing expansion will create additional headwinds in an already stressed out fiscal house.
"With the recent inception of direct transfers in the budget, the fiscal could easily be on a slippery slope unless there is a rationalization of expenditure," it said including round 55 in step with cent of central executive expenditure is mounted in nature and the eventual impact might be on additional decreasing capex.
Given the stressed out fiscal house, debt markets are pressured with heavy executive and PSE borrowings, which are likely to keep the yield curve steep in FY2020, it added.
Kotak said whilst various task indicators were signalling a slowdown in portions of the economic system, the tax collections corroborate it too.
"Aggregate indirect tax revenues' buoyancy has been weak along with targets being missed on direct taxes too. Further, persistently high borrowing cost for financial institutions and companies (given crowding out by the government sector) will weigh on the near-term aggregate demand in the economy," it said.
From a medium-term point of view, if the federal government does no longer increase its capital expenditure (upper transfers and muted tax expansion), the expansion potentialities can be underneath doubt given estimated fiscal multipliers, it added.
Income tax e-filers drop by over 6.6 lakh in FY19: Official data
![Income tax e-filers drop by over 6.6 lakh in FY19: Official data]()
Reviewed by Kailash
on
May 05, 2019
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