India has witnessed a remarkable surge in direct tax collections, which have increased by 182% to over US$ 233.25 billion (approximately Rs. 19.60 trillion) in the fiscal year 2024 (FY24). This impressive growth is a significant milestone during the decade-long tenure of Prime Minister Narendra Modi. According to the latest 'Time Series Data' released by the Income Tax Department, the increase in tax revenues highlights the government's efforts to enhance compliance and widen the tax base.

Over the past ten years, corporate tax collections have more than doubled, reaching over US$ 108.41 billion (Rs. 9.11 trillion). Concurrently, personal income tax revenue has nearly quadrupled to US$ 124.36 billion (Rs. 10.45 trillion). In FY15, which marked the beginning of Modi's administration, direct tax collection stood at approximately US$ 82.83 billion (Rs. 6.96 trillion), comprised of US$ 51.05 billion (Rs. 4.29 trillion) from corporate tax and US$ 31.66 billion (Rs. 2.66 trillion) from personal income tax.

The number of income tax returns filed, including revised returns, has also seen a substantial rise, increasing from over 4.04 crore in FY15 to more than 8.61 crore in FY23. This growth reflects the heightened compliance among taxpayers and the effectiveness of tax administration reforms.

Moreover, the direct tax-to-GDP ratio has improved significantly, climbing from 5.55% in FY15 to 6.64% in FY23. This improvement underscores the growing importance of direct taxes in India's overall economic framework. The tax buoyancy, which measures revenue mobilization efficiency relative to GDP growth, has jumped from 0.86 to 2.12 during this period, indicating a strong correlation between economic growth and tax revenue generation.

Additionally, the total number of taxpayers in India has expanded significantly, rising from 5.70 crore in 2014-15 to 10.41 crore in 2023-24. This notable increase demonstrates the government's success in broadening the tax base and improving overall tax compliance.

These developments in direct tax collections reflect a robust economic performance under Modi's administration, showcasing the government's focus on creating a more efficient and transparent tax system that can support sustainable economic growth.

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