Tata Steel, ONGC lead surge in advance tax
Top 20 firms pay 47% more in Q2; RIL, HDFC, ITC skip payment
The advance tax paid by the top 20 marquee companies grew over 47 per cent year-on-year during the second quarter of FY22 to ~27,210 crore from ~18,462 crore, on the back of hefty payments by Tata Steel, Oil and Natural Gas Corporation (ONGC), and lenders.
Tata Steel's advance tax payment jumped 3,900 per cent to ~4,000 crore; it was followed by ONGC whose payment zoomed 662 per cent because of the surge in oil prices in the international market. It paid ~2,250 crore in the quarter ended September 15, 2021, against ~295 crore a year ago, official sources said.
On the other hand, heavyweights — such as Reliance Industries, Tata Motors, HDFC, and ITC — skipped payments for the second consecutive quarter in the current financial year by availing a provision that allowed them to carry forward losses, said a government official in the know. He added that companies are allowed to do so for six years under the Income Tax Act.
Top state-owned financial institutions, including State Bank of India (SBI) and Life Corporation of India (LIC), reported double-digit growth in their advance tax payment. They paid ~3,834 crore (up 28.8 per cent) and ~3,171 crore ( up 12.8 per cent), respectively.
Other state-owned lenders, such as Punjab National Bank (PNB) and Canara Bank, too, paid relatively hefty amounts over the same quarter a year ago — ~313 crore (up 123 per cent) and ~850 crore (up 41 per cent), respectively.
According to officials, the first instalment payments showed growth on account of a low base but upturn continued even in the second quarter, reflecting that the second Covid wave did not have much impact on growth and earnings of at least these companies. However, sectors like aviation and telecom — burdened with losses — have been showing nil payment for the past few quarters, they pointed out.
Automotive majors and fastmoving consumer goods firms, too, appeared to have gained from relaxation in lockdown measures and pent-up demand. For instance, the tax outgo of Hero Motocorp and Maruti Suzuki grew 41 per cent and 13 per cent, respectively. Hero Motocorp paid ~250 crore against ~177 crore a year ago; Maruti Suzuki paid ~340 crore this quarter. FMCG companies, including Hindustan Unilever, Procter & Gamble, and Nestlé also were ahead in the tax outgo leaderboard, reporting growth of up to 67 per cent. The three paid ~822 crore (up 9.6 per cent), ~62 crore (up 67.5 per cent), and ~180 crore (up 2.9 per cent), respectively.
Technology giants, too, reported good numbers, owing to robust demand in order flows as the pandemic accelerated digitisation. TCS paid ~2,330 crore, a jump of 31 per cent; Tech Mahindra's outgo surged 22 per cent to ~430 crore. Infosys' number, however, showed a slight contraction of 3.7 per cent; it shelled out ~1,300 crore this quarter against ~1,350 crore in the same period a year ago.
NTPC, the state-run power generation firm, reported over 21 per cent growth and paid ~960 crore this quarter. On the other hand, Larsen & Turbo's outgo contracted 80 per cent to ~130 crore from ~675 crore a year ago.