TDS Collection: The government is giving a lot of emphasis on TDS to increase the revenue and the efforts of the government are also getting success. This is clearly evident from the official statistics…
The pressure on the exchequer has increased steadily to meet the rising expenditure on infrastructure and other needs of a rapidly growing economy. To reduce this pressure, the central government is making all efforts to increase the income and under these efforts, there is special emphasis on TDS Revenue Collection. During the last few years, the government has also got success on this front. Figures testify that the government’s earnings from TDS are increasing.
Increased collection in this way
According to statistics, the government earned Rs 6.34 lakh crore during the financial year 2021-22. This was about 39 percent of the total direct tax collection, which is very close to the figure of Rs 7 lakh crore received from Advance Tax Payment. Compared to the figures of a few years ago, if we look at this, then the increase in earnings seems to be correct. During the financial year 2014-15, the government received only Rs 2.59 lakh crore from TDS, which was 32 per cent of the total direct tax collection. This means that during the last seven years, the government’s earnings from TDS have increased by about 2.5 times.
These measures worked
The government has tightened the provisions regarding TDS. The government has made a single party responsible for tax collection and depositing it in the treasury. It is also benefiting and compliance with the rules regarding TDS has improved. For this reason, the proportion of TDS earnings in the total direct tax collection has increased from 32 per cent in the financial year 2014-15 to 39 per cent in the financial year 2021-22.
Now focus on these things
The government has recently tightened some more provisions related to TDS. The government has abolished the TDS exemption on interest paid on listed debentures. Apart from this, in case of winning online game, TDS has been implemented without any minimum limit. In the budget, it has been proposed to increase the rate of TDS on certain categories of foreign remittances from 5 per cent to 20 per cent.
These also include the purchase of foreign travel packages. The government has also imposed TDS on cryptocurrency trading last year. In this way we can see that the government is making every possible effort to increase the earnings from TDS.
The Income Tax Department is also looking at measures other than TDS to improve compliance in tax matters. The Income Tax Department is also using third party information for this. This information is shared with the taxpayers in the Annual Information Statement.
Direct tax collection also improved
The figures of the Income Tax Department also show that during the financial year 2021-22, the income from direct tax collection was more than 50 percent of the total revenue from the tax. This becomes important because during the financial year 2020-21, the share of direct taxes in the total tax collection was less than that of indirect taxes.
