3rd installment : Advance corp tax jumps 50% on low base

The third instalment of advance tax paid by corporate sector grew by nearly 50% compared with last year but it was primarily because of low-base in the previous year. At the same time, the advance tax paid by individuals during September 16-December 15 period declined by about 6%, officials in the tax department said.

Last year, the corporate tax rates were reduced to 22% from 30% and it came into effect from December quarter. But the companies had already paid two instalments of advance tax at higher rate, which meant that the third instalment liability was reduced significantly resulting in a lower collection during the third quarter (September 15-December 15 period) payment last year.

However, while the direct tax collection growth continued to be in negative territory for the current fiscal, the contraction has narrowed from 20% in November to about 13% on December 15, sources said.

A section of corporate taxpayers, professionals and individuals are required to pay advance tax in four instalments through the year. Such taxpayers are required to pay 15% of the estimated tax liability by June 15, followed by 45% by September 15, 75% by December 15 and the remaining by March 15.

Total advance corporate tax by December 15 stood at Rs 2.39 lakh crore, about 5% lower than last year. Similarly, advance tax on personal income after third instalment came in at Rs 60,491 crore, a decline of just over 10% from last year.

Total gross direct tax collection by December 15 came in at Rs 7.34 lakh crore. The budget estimate for direct tax for the current fiscal is pegged at Rs 13.19 lakh crore, a jump of 27% from actual collection in the last fiscal at Rs 10.37 lakh crore.