Tax from automobile sales up 35 per cent in the first seven months of current financial year
Punjabis craving for the latest cars, bikes and SUVs has given a push to the states Value Added Tax (VAT) kitty, which had swollen to a hefty Rs 6,000 crore during the first seven months of this year. The amount is Rs 1,500 crore more than last years figure for the corresponding period and it is expected to cross the Rs 10,000 crore mark by the end of this fiscal.
Talking to The Indian Express, Punjabs Excise and Taxation Commissioner A Venu Prasad said, The excise and taxation department has already collected Rs 6,000 crore in the first seven months of this year from April to October, against Rs 4,430 crore in the corresponding period last year. This is due to effective tax policy and administration. The main reason for increase in VAT revenues is Punjabis craze for buying cars. There has been a 35 per cent VAT increase in the automobile sector as the car sales were much more than last year we collected Rs 400 crore (from car sales) last year in the first seven months and this year the figure is Rs 600 crore. Sales were high this festive season, also there was an increase in VAT collections of white goods and a 40 per cent rise in VAT collections in grocery, hosiery and steel items.
This is despite the fact that there has been a decrease in VAT revenue from wheat and paddy. We are expecting a decrease by Rs 100 crore as we will be collecting Rs 1,500 crore against an expectation of Rs 1,600 crore, Prasad added.
Prasad said, Electronic filing of VAT returns made mandatory for all dealers this financial year has also shown good results as 1.70 lakh dealers filed their returns. Also, due to higher enforcement some 20,000 new dealers were brought under VAT regime and thus the state now has 1.90 lakh dealers covered under VAT.
Prasad claimed that going by the pace of collection and growth witnessed, the department was sure that the collection would cross the Rs 10,000 crore landmark easily. The department will appoint 118 new inspectors next year and the proposal to appoint 74 new ETOs has been sent to the Public Service Commission. Thus, with appointment of more staff, VAT collections will increase.
Punjab Deputy Chief Minister Sukhbir Singh Badal said, The government is set to double VAT collection from Rs 5,000 crore to Rs 10,000 crore within three years whereas excise collection had reached Rs 2,500 crore from Rs 1,500 crore and was expected to cross the Rs 3,000 crore mark next year.
Repudiating the assertions of former Finance Minister Manpreet Singh Badal and former Chief Minister Capt Amarinder Singh about the poor fiscal state of Punjab, Sukhbir said, With better economic planning the state was making rapid strides on the development front.
However, Punjab continues to be under a huge debt which was pegged at Rs 64,924 crore by March 31, 2010. The figure has reached Rs 71,000 crore. The states public sector undertakings are also running up losses. The only silver lining is the leap in VAT collections and growth in agriculture, which despite floods and heavy rains registered a growth rate of 3.42 per cent last fiscal, which is more than double the national growth rate of 1.8 per cent. This figure is projected to reach 3.74 per cent in 2010-11.