1% drop in IT return filings: Number of high-income earners going up is the silver lining

The financial year 2018-19 witnessed a one per cent drop in the number of e-income tax return filers. Citing official data, a report by brokerage Kotak Securities says only 66.8 million returns were filed in FY19. As against 67.5 million in the previous fiscal, which is down 1 per cent. But the same Kotak Securities study concedes that the number of high-income earners filing returns has gone up. It lifts the pall of gloom no sooner than it set in.

The study bemoans the fact that demonetisation expected to bring more and more persons into the mainstream of the economy. But the study seems to have missed the wood for the trees in 2017-18. The number of returns filed registered a quantum jump of nearly 26 per cent vis-à-vis the previous year 2016-17. In which in absolute terms constituted an additional whopping one crore new returns.

Having smoked out a humungous number of hitherto non-filers, demonetisation had indeed achieved its objective of formalising the economy. It is unfair to expect an encore of this feat every year especially when the demonetisation year itself witnessed a flood of hike in income tax return filers.

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