An Analysis of Pre and Post Digitization of Direct Taxation in India - A Study (International Journal of Science Strategic Management and Technology)

Summary

• A paired t-test gives t=6.00 with 9 degrees of freedom, indicating that post-period direct-tax collection is systematically higher than in the pre-period.p.8
• The estimated pre-period slope is approximately ₹56,914 crore per year and the post-period slope approximately ₹218,055 crore per year, an increase of about ₹161,141 crore per year.p.9
• Returns filed for AY 2023–24 reached 7.41 crore, including 53 lakh first-time filers, in a CBDT release of October 2023.p.9
• The Centralized Processing Centre in Bengaluru was approved at a total project cost of ₹255 crore.p.5
• A cited study reports on-time GST filing rising from 67% to 82% and GSTR-1 to GSTR-2B mismatches falling from 8.4% to 4.2%.p.3

Key insights

1. The statistical evidence points to a change in the growth trajectory of direct-tax collection rather than a single abrupt jump.p.9
2. The immediate level shift at the break is not statistically significant at the 5% level.p.9
3. By Assessment Year 2007-08 all companies were required to file returns electronically.p.5
4. From Assessment Year 2013-14 individuals with income exceeding ₹10 lakh were also mandated to e-file.p.5
5. Centralized processing replaced jurisdiction-based manual processing for e-filed returns.p.5
6. Pre-filled returns and validation checks reduce common filing errors and the need for rectification.p.7
7. The analysis does not prove that digitization caused the entire post-period rise in direct-tax revenue, as other policy and economic events occurred.p.10