Page 30 - Banking Finance March 2025

ARTICLE

financial year 1965-66 number of tax slabs was ten (10), in filing income tax return was 8,09,03,315. It was 6,72,08,614
the financial year 1975-76 number of tax slabs were nine during the financial year 2020-2021. So there is an increase
(9) but in the current financial year number of tax slabs are of 1,36,94,701 persons from 2020-2021 financial year to
seven (7). Limit of standard deduction against salaried 2023-2024 financial year. This increase is due to introduction
income is Rs. 75,000. Rebate will be available upto total of new tax regime system i.e. Section 115BAC.
income of Rs. 12,00,000.
Sharp rise in Direct tax- GDP ratio :
Central Board of Direct Taxes:
Direct tax occupies a considerable source of revenue for the
The Central Board of Direct Taxes, created by the Central government. The direct tax-GDP ratio measures a country's
Boards of Revenue Act 1963, is the apex body entrusted with tax revenue relative to the volume of its economy. Direct
the responsibility of administering direct tax laws in India. taxes affect a nation's gross domestic product by increasing
The matters relating to the levy and collection of all direct the amount available to the government. The collected
taxes are looked after by the CBDT i.e. Central Board of direct tax is used by the government for social and economic
Direct Taxes. The CBDT is implementing a comprehensive development of the country.
computerization programme in the Income Tax Department
with modern information technology as a key driver. The Table: 3 Direct Tax -GDP Ratio
programme is aimed to establish a taxpayer friendly regime,
increase the tax-base, improve supervision and generate Financial Net Collection of Direct Tax
more revenue for the Government. Year Direct Taxes GDP Ratio
(Rs. Crore)
Widening of Tax Base: 2020 - 21 947176 4.78%
The new tax regime offers a rational and simplified 2021 - 22 1412422 5.97%
approach to income tax calculation. It provides lower tax
2022 - 23 1663686 6.17%
rates for individual tax payers. It increases basic exemption
2023 - 24 1960166 6.64%
limit. Thus the new tax regime attracts tax payers to pay
income tax and to file income tax return. As a result total Source: Time Series Data, Income Tax Department, 2023-
number of persons filing income tax return has been 2024
gradually increasing since 2020-2021. The number of new
assessees added during the Financial Year 2023-24 is During the financial year 2023-2024 there was a significant
6,89,3046.The number of persons filing income tax return achievement in tax collection. As a result Direct tax- GDP
over the last five years is as follows: ratio was 6.64% in the financial year 2023-2024. From the
above table it is clear that there is a gradually increasing
Table:2 Number of persons filing income trend in result of Direct tax- GDP ratio from the financial

tax return year 2020-2021 to the financial year 2023-2024. This is due
to implementation of new tax regime.
Financial Total number of persons Percentage
Year filing income tax return (%)
2020-2021 6,72,08,614 ---
2021-2022 6,96,35,446 3.61%

2022-2023 7,40,10,269 6.28%
2023-2024 8,09,03,315 9.31%
Source: Time Series Data, Income Tax Department, 2023-
2024

During the financial year 2023-24 total number of persons

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