The finance ministry expects to overshoot its indirect tax collection target by Rs 15,000 crore. For 2010-11, the government had set an indirect tax collection target of Rs 315,000 crore. “We may exceed our original target…It (indirect tax mop-up) could be around Rs 330,000 crore this year,” V Sridhar, chairman of Central Board of Excise and Customs, told reporters.
He said the growth would be driven by a good show seen in excise and customs collections, which are likely to exceed the budgetary target of Rs 132,000 crore and Rs 115,000 crore, respectively. Service tax collections, on the other hand, may just meet the target of Rs 68,000 crore.
Sridhar said excise and customs collections increased mainly on account of partial rollback of the excise duty and increase in duty on petroleum, while there was no duty rollback in case of services. He said the impact of taxation on eight new services, introduced with effect from July 1, would be seen in collections in the coming months.
In its Budget in February, the government had restored the basic duty of five per cent on crude petroleum, 7.5 per cent on diesel and petrol, and 10 per cent on other refined products. It had also enhanced the excise duty on petrol and diesel by Re 1 per litre.
In 2009-10, the government had to revise its budgetary target of indirect tax receipts to Rs 244,447 crore from Rs 268,000 crore. The revenue department managed to mop about Rs 2,000 crore more at Rs 246,000 crore.
The government has budgeted an overall tax mop-up of Rs 746,000 crore for 2010-11. Indirect tax collections increased 44.4 per cent to Rs 150,686 crore in first six months of this financial year. The mop-up was 48.1 per cent of the indirect tax Budget Estimates for 2010-11.
Direct tax collections, on the other hand, increased 19.09 per cent to Rs 181,758 crore in the first half of this year, against Rs 152,625 crore in the corresponding period last year. The mop-up was 42.27 per cent of the budgetary target of Rs 430,000 crore for 2010-11.
Finance Minister Pranab Mukherjee said gross tax revenue had so far grown by 27.3 per cent, compared to an 11.6 per cent fall last year and 17.9 per cent growth estimated for 2010-11.
Total revenue receipt increased 85 per cent, mainly on account of telecom spectrum auctions and robust growth in excise and customs duty receipts of 43 per cent and 60 per cent, respectively. Total expenditure grew 30.4 per cent, as against 22.8 per cent last year.