To propel demand, one should concentrate on indirect taxes and bring down the goods and services tax (GST) rates to a uniform 12 per cent as the Vijay Kelkar panel had recommended, said Ajit Ranade, chief economist at Aditya Birla Group.
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India has in recent months stepped up enforcement of tax collections as it looks to raise revenue to help plug its widening fiscal deficit.
Data released earlier by CAG shows capital expenditure by the Centre had contracted 9.2 per cent in Q2
All eyes will be on whether Sitharaman will deliver a populist budget leaving more money in hands of the common man or push the reform agenda by staying on the fiscal glide path to lower the fiscal deficit to 4.5 per cent of GDP by 2025-26.
During April-October 20 period, the tax department has made refunds to the tune of Rs 80,850 crore.
The only saving grace in indirect tax collection during the month was 29.6 per cent rise in service tax realisation.
Since its rollout 13 months ago, the new indirect tax has yielded Rs 1 trillion only in in April 2018
The Centre is staring at a combined shortfall of up to Rs 1 trillion in excise and Customs revenues in the current financial year (FY23) compared to the Budget estimates (BE), mainly because of duty cuts on edible oil and petroleum products. The government set a target of Rs 3.35 trillion for excise and Rs 2.13 trillion for Customs mop-up for FY23 while presenting the Budget in February. "As excise duty collection is mainly driven by diesel volumes, we might see a clear gap in the level budgeted for FY23, following the reduction in cesses on petrol and diesel in May. We are expecting somewhere between Rs 80,000 crore and Rs 1 trillion dip in excise and customs duty collections," a senior government official told Business Standard.
The government is also looking to earn 8 paise for every rupee from Union excise duty and 3 paise from customs duty. While, income tax will yield 14 paise to every rupee collection.
Amid the growing chorus against black money and the government's efforts to pull the plug, Union Law Minster M Veerappa Moily has suggested Finance Minister Pranab Mukherjee to completely overhaul the tax administration.
Tax experts said historically in July and August indirect tax collections remain subdued and pick up with the onset of the festive season post Ganesh Chaturthi.
As per norms, the returns have to be filed online on www.aces.gov.in.
The shortfall in the Centre's GST collections has raised concerns over it meeting the fiscal deficit target of 3.3 per cent of GDP, reports Ishan Bakshi.
GST collections in March grew 13 per cent to the second highest ever at Rs 1.60 lakh crore, taking the growth rate of revenue mop-up for full 2022-23 fiscal to 22 per cent. March also saw over 91 per cent of the GST registered businesses filing returns and paying taxes - reflecting greater compliance and improving economic activity. Gross GST revenue collected in March 2023 is Rs 1,60,122 crore, of which Central GST is Rs 29,546 crore, State GST is Rs 37,314 crore, Integrated GST is Rs 82,907 crore (including Rs 42,503 crore collected on import of goods) and cess is Rs 10,355 crore, the finance ministry said in a statement.
All eyes will be on whether Sitharaman provides the much-expected tax relief for the middle class, leaving more money in their hands, as there is tax buoyancy
Senior tax officials were told to focus on cash collection from the arrears so that the target for FY23 was achieved and the overall revenue position improved.
GST collections in March slipped below the psychological Rs 1 lakh crore-mark for the first time in four months to Rs 97,597 crore as the Covid-19 lockdown that shut most businesses compounded tax collection woes in an already sluggish economy. Goods and Services Tax (GST) mop-up in March recorded a 8.4 per cent decline over March 2019 collection of Rs 1.06 lakh crore. The collections were lower on account of dip in revenues from domestic transactions as well as imports.
In 2015-16, more than 94 per cent of income tax returns were filed online and 4.14 crore returns were processed by the Central Processing Centre.
The removal of 10 per cent surcharge on direct taxes to cost Rs 10,034 crore.
The buoyancy in the tax revenue of GST reflects the upswing in the economy and better compliance
When the Centre collects money through cess, it can retain the entire fund for the particular scheme.
The GST revenues for August 2023 have shown a growth of 11 per cent year on year due to increased compliance and less evasion, Revenue secretary Sanjay Malhotra said on Friday. The collection from Goods and Services Tax (GST) was Rs 1,43,612 crore in August 2022. "Roughly numbers are in the range of 11 per cent year on year growth as in earlier months," Malhotra told reporters.
The Goods and Services Tax (GST) Council, scheduled to meet on June 22, could take a call on ending uncertainty on taxing foreign airlines and shippers as regards certain services, a senior official in the know told Business Standard. He said the Council was expected to decide on exempting the services in question from GST - aircraft lease rentals, maintenance, crew salaries, etc. These services are provided by foreign airlines to their Indian operations.
These have to be passed in this session to meet the September 15 deadline for switching over to the new indirect tax regime, Jaitley said.
Is the curated and limited data put out by the central government sufficient enough to pass a judgement on the trend in GST collections, particularly that of the Centre?
CRISIL chief economist D K Joshi is of the opinion that GDP is an indicator of the health of the economy.
GST collections rose 12 per cent to over Rs 1.61 lakh crore in June, the finance ministry said on Saturday. The gross GST collection has crossed Rs 1.60 lakh crore mark for the fourth time since the roll-out of the indirect tax regime six years ago on July 1, 2017. The average monthly gross GST collection for the first (April-June) quarter of the 2021-22, 2022-23 and 2023-24 are Rs 1.10 lakh crore, Rs 1.51 lakh crore and Rs 1.69 lakh crore, respectively, the finance ministry said in a statement.
The Income tax department to come down heavily on errant taxpayers from India Inc.
Total disputed liability of Mallya with respect to service tax to the tune of Rs 535 cr
India on Friday called on the International Monetary Fund (IMF) to reconsider its $1 billion assistance to Pakistan, suggesting that Islamabad could use it for terror funding.
The Centre could better its fiscal deficit at 6.6 per cent of GDP in this financial year on stronger-than-expected revenue buoyancy, even if the budgeted disinvestment target is not met, Fitch Ratings has said. The international rating agency had last week kept the sovereign rating unchanged at 'BBB-' with a negative outlook, and said that the risks to India's medium-term growth outlook are narrowing with rapid economic recovery from the pandemic and easing financial sector pressures. In an email interview with PTI, Fitch Ratings Director (Asia-Pacific Sovereigns) Jeremy Zook said the two key positive triggers that could lead to a revision of the outlook to stable are implementation of a credible medium-term fiscal strategy to lower debt burden and higher medium-term investment and growth rates without the creation of macroeconomic imbalances, such as from successful structural reform implementation and a healthier financial sector.
Govt looks at more taxes, dividends to meet deficit target.
The Vivaad se Vishwas scheme is a replica of the Sabka Vishwas (Legacy Dispute Regulation) Scheme, 2019 (SVLDRS) for indirect tax litigation. The hope is that this would unlock revenue blocked in long-drawn litigation at various forums. Sources in the department say the total value at stake in these disputes would be Rs 5-6 trillion.
Finance Minister Pranab Mukherjee on Tuesday said the government had no exit strategy for incentives announced as part of the stimulus packages, even as there has been a 28 per cent fall in indirect tax collections till July.He further said the government was ready to take improved measures to combat drought, which has affected 272 districts in the country.
The fitment committee under the Goods and Services Tax (GST) Council, comprising central and state officials, has begun a rate rationalisation exercise afresh, checking the possibility of dropping some of the rates, particularly the 12 per cent slab, to achieve a revenue-neutral structure, a senior official with direct knowledge of the matter
While the ratio determines the extent to which the government is able to finance its expenditure, it is also an indicator of tax compliance. Developed countries have a higher contribution of tax to their GDP.
The scheme offers waiver of interest, penalty, and prosecution for settling tax disputes.
With the stimulus measures primarily comprising cut in indirect taxes, the Survey said there is likely to be a shortfall in tax collections under these heads.
The total revenue earned by central government and state governments after regular settlement in December was Rs 43,851 crore for CGST and Rs 46,252 crore for SGST.
The government's plan to mop-up additional revenue from indirect tax may not materialise
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