Despite dismal tax collections, the government disbursed close to Rs one lakh crore in income-tax refunds during 2011-12 financial year, the highest ever payment to tax-payers, recording a 32.4 per cent increase from the Rs 74,000 crore refunds during 2010-11.
The figure is estimated to touch Rs 1.20 lakh crore in the current financial year, as the number of those who file e-returns increases, a revenue department official told The Indian Express.
Explaining the record increase in payment of refunds, the official said ever since the Central Processing Centre (CPC) in Bangalore started functioning to full capacity in April 2010, the time taken to process refunds has reduced sharply and has helped the department to cope with the rapid growth in the number of tax-payers. The government is setting up two more CPCs — in Pune and Manesar.
Moreover, as the number of e-return filers increases, the refunds will increase, as the computer-based system generates refunds automatically. During the last financial year, of the over three crore tax-payers, 1.64 crore filed e-returns as against 90,500 in 2010-11. “This number is likely to go up to 2.5 crore this year,” the official added.
During the last financial year, the total income tax collection stood at Rs 4.94 lakh crore, falling short of the revised target of Rs 5 lakh crore.
The Finance Ministry had targeted Rs 5.32 lakh crore in collections when the Budget for the last fiscal was presented.
“However, we believe that the final shortfall is going to settle at around Rs 3,000-4,000 crore for 2011-12,” the official said.