Signs of buoyancy | Mint

At ₹3.54 trillion, advance tax collections in this fiscal year’s first half have reportedly been a fifth greater than last year’s, with the final figure likely to rise a bit as it doesn’t include all payments till the second quarter’s 15 September deadline. Corporate tax revenue made up ₹2.8 trillion, while the rest came from personal income tax. This speaks well of the health of Indian companies, as higher taxes paid in advance point to profits improving. This may partly be a result of a decline in input costs as commodity prices cooled, although, with crude oil simmering again, fresh inflationary pressures could arise for businesses. But that should not deflect attention from the positive signals it sends about the economic momentum. The goods and services tax mop-up has also been strong. While there has been much debate over nominal versus real values, what’s important is that the government is able to meet its fiscal deficit target. Set at 5.9% of gross domestic product for 2023-24, this already represents a slow post-covid return to normalcy. The Centre’s glide-path aim is to bring it down to 4.5% by 2025-26, which would still be well above the 3% upper limit enacted in 2003.