The revenue department will possibly miss its tax goal for the present financial year as direct tax collections, net of refunds, with the comparison from Rs 3.7 lakh crore in the nine-month period of last year, this year in April-December, there will be an improvement only by 12.5 per cent to Rs 4.15 lakh crore,.
Despite the fact that the collections have a slight improvement in the last couple of months, the pace is still sluggish. Because of the economic downturn and with this slower-than-expected growth, the tax department is experiencing a large task of gathering Rs 2.5 lakh crore in the next three months to meet the Budget Estimate of Rs 6.7 lakh crore that represented a growth of 19 per cent over last year’s mop-up.
January 6, Monday, Finance Minister P Chidambaram took a review meeting concerning about muted tax collections with officials from the Central Board of Excise & Customs and Central Board of Direct Taxes. Ways to increase collections in the coming months were discussed.
The finance ministry said on Monday, gross direct tax collections (before paying income tax refunds) during April-December of 2013-14 were up 12.3 per cent at Rs 4.8 lakh crore, against Rs 4.3 lakh crore in the same period of 2012-13. “Gross collections of corporate taxes have shown an increase of 9.35 per cent and stood at Rs 3.1 lakh crore, against Rs 2.8 lakh crore during the same period last year. Gross collection of personal income tax was up by 18.5 per cent and stood at Rs 1.7 lakh crore, against Rs 1.4 lakh crore during the same period in the last year,” it said.
Collection of securities transaction tax stood at Rs 3,427 crore this shows that there is an increase of 4.04 per cent. Wealth tax collection posted an increase of 11.92 per cent and stood at Rs 742 crore, in opposition to Rs 663 crore during the same period in last year.
The collections are normally higher during June, September, December and March because quarterly advance tax payments by companies is made in these months. The contribution of the advance tax up to the December quarter has been Rs 2.02 lakh crore is representing an overall growth of 8.8 per cent.
The Centre's fiscal shortfall has by now reached close to 94 per cent of the Budget Estimate in just eight months of the current financial year. Tax revenues will have to participate in a vital part in the government's hard work to rein in the deficit at the estimated 4.8 per cent of GDP in 2013-14, an aim that the finance minister has been wanting to accomplished and had given it a deadline.