Spurt in indirect tax mop-up to help meet FY16 target: Govt

Tribune News Service

New Delhi, February 10

The government today said it will meet the current year’s revenue collection target through a strong upswing in indirect taxes such as excise, customs and service tax.

The Finance Ministry said direct and indirect tax collection together is expected to meet the target of revenue collection for the current year 2015-16 without any shortfall.

Revenue Secretary Hasmukh Adhia said the latest tax revenue numbers up to January 31, 2016 indicate healthy growth of 33.7% in indirect tax and 10.9% in direct tax collection.

As against the annual Budgetary Estimate (BE) target for tax collection of Rs 14.49 lakh crore, the government has received Rs 10.66 lakh crore, which is 73.5% of the BE target.

Adhia said looking to the trend, it appears that as far as indirect tax collection is concerned, the government may get more than Rs 40,000 crore extra over and above the BE target for indirect taxes for 2015-16 while there might be an equal amount of shortfall in direct tax collection.

“However, both direct and indirect tax collection put together, we expect to meet the annual BE target of revenue collection for the current year without any shortfall”, he said. The government will meet the revenue collection target set in the Budget for the first time in five years.

Of the Rs 14.49 lakh crore tax revenue target set for 2015-16, Rs 7.97 lakh crore was estimated to come from direct taxes (corporate and income tax) and another Rs 6.47 lakh crore from indirect taxes (customs, excise and service tax).

In April-January of the current fiscal, the growth in customs duty revenue on electrical machinery was 34.4% and in other machinery it was 27.8%.

“These are indicators of new investment taking place in private sector. New investments are taking place in the country for which these machineries are imported,” Adhia said.

In the services sector, as against 27.2% average growth rate, the growth rate in banking and financial services was 44.6%.

In work contract services, it is 39.9% and in goods transportation services growth rate is 41%.

“These are also indications of high level of economic activities taking place in the country,” Adhia said.