Indirect tax collection target tough but achievable: Jaitley
12 Aug 2014
Union finance minister Arun Jaitley admitted on Monday said that the indirect tax collection target pegged at Rs6.23 lakh crore in the Budget for 2014-15, is challenging; but was quick to add that the target is achievable.
Indirect tax collections grew 4.5 per cent in the first quarter against the 25 per cent projected for the entire year, he said, addressing the annual conference of chief commissioners and directors-general of customs, central excise and service tax in New Delhi.
Jaitley said the past few years have been difficult for the Indian economy. Modest economic growth was coupled with a static or negative growth in manufacturing, which took a toll on indirect tax collections, he noted.
India's economy grew at well below 5 per cent in the last two financial years. Manufacturing growth stood at 1.1 per cent in 2012-13, and contracted by 0.7 per cent the next year.
"In order to spur growth, we have in the past few months concentrated on improving areas of manufacturing and infrastructure," Jaitley said.
He added that figures relating to the manufacturing sector in the initial months of the current financial year are quite encouraging. After falling for two consecutive months, manufacturing rose 2.5 per cent in April and 4.8 per cent in May.
"If this trend continues for a few more months, only then will it constitute a pattern," said Jaitley.
He asked the Central Board of Excise & Customs to work as a facilitator for tax-payers, and at the same time take action wherever they find cases of revenue leakages or tax evasion.
The finance minister also stressed the need for reducing tax litigation and improving tax settlement mechanism in order to unlock the money thus held up.
Revenue secretary Shaktikanta Das said indirect tax collections rose just 4.5 per cent in the first quarter of the current financial year, but the growth was 13.5 per cent in June. "Service tax accounted for nearly 28 per cent growth," he said, adding that the growth was "very good" in July as well.
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