After increasing the direct tax collections target in 2010-11 by Rs 20,000 crore, the finance ministry now plans to raise the indirect tax receipts by at least Rs 10,000 crore to Rs 3,25,000 crore for the same period.
Indirect tax collections have shown good growth. We are planning to increase the target by at least Rs 10,000 crore. This will be shortly communicated to the field officers, said a finance ministry official.
Indirect tax collections went up by 42.3 per cent to Rs 2,07,756 crore in the April-November period, against Rs 1,45,958 crore in the corresponding months of 2009-10. The collections in the first eight months were about 66 per cent of the Budget estimate of Rs 3,15,000 crore for 2010-11. Last years collections during the same period constituted 54.5 per cent of the overall target for 2009-10.
While the target will be revised upwards for all the three indirect taxes customs, excise and service tax the increase in collections will primarily be on the back of Customs and excise duty mop-up, which showed a rise of 67 per cent and 34.4 per cent, respectively, in the first eight months of 2010-11. Service tax collections have grown 18.2 per cent in the same period.
The Budget Estimate (BE) for collections from Customs, excise duties and service tax is Rs 1,15,000 crore, Rs 1,32,000 crore and Rs 68,000 crore, respectively, in the current financial year. Till November, the revenue department had collected Rs 86,844 crore from Customs (75.5 per cent of BE), Rs 81,984 crore from excise duty (62 per cent of BE) and Rs 38,927 crore (57 per cent of BE) from service tax.
Last week, Finance Minister Pranab Mukherjee had increased the Budget target for the Central Board of Direct Taxes to Rs 4,50,000 crore from Rs 4,30,000 crore. This meant 19 per cent rise in direct tax collections over Rs 3,78,000 crore mopped up last year. The target was revised by Mukherjee keeping in mind a 19 per cent increase in direct tax collections in the first eight months this financial year.
An indirect tax collection target of Rs 3,25,000 crore would mark a 32.5 per cent increase over last years collections of Rs 2,46,000 crore. Going by the revised targets, the incremental increase in indirect tax collections in 2010-11 would be more than the increase in direct tax collections over 2009-10.