How much is the direct and indirect tax revenue expected to be for FY23?

Direct tax revenues are tracking at 63.1% of the BE as of April-November, bolstered by the trend in both corporate tax and income tax collections which touched 64.6% and 61.7% of BE respectively. Indirect taxes, which are trailing at 75.9% of BE as of November continue to outperform direct taxes led by modest growth across its subcomponents. Within indirect taxes, the mop-up from GST collections has been noteworthy as the revenues from GST have continued to track above the Rs1tn mark since Oct-20 (barring Jun-21) and registering an FYTD22average of Rs1193.5bn.

Gross tax revenue is expected to exceed in FY22 vis-à-vis the budget estimates on account of higher tax collections. Consensus estimates expect total tax revenue growth of ~15% YoY, with direct taxes rising by 19% YoY and indirect taxes are expected to be subdued on potential cut in excise duties going forward.