Though loss due to the apex court verdict in Vodafone case may not be a factor, income tax department is still wary about the overall collection for the year. Chairman of Central Board of Direct Taxes (CBDT) MC Joshi expressed disappointment over the year on year growth in tax collections, which is only increased by 8% compared to 18% last year.
Joshi, who was addressing newspersons on the sidelines of inaugural function of a hostel building at National Academy of Direct Taxes (NADT), said a minimum 18% growth was desirable. The collections at 3,74,000 crore are 63% of the total budgeted amount. Much is expected from the last three months of the fiscal when bulk of the collection comes. The collections as against the budgeted amount, compared to the previous year, are lagging by 7%, added a senior official from the department. It cannot be predicted whether the collections will match the budgeted figure, he said.
Joshi, who said that the Vodafone decision will not have many major impact, blamed economic slowdown for lower collections. He said this may even disturb fiscal deficit management. The financial sector has taken the biggest hit, he added. On Vodafone verdict, he said that a team of experts would be studying the order and it was too early to say whether the verdict would have an impact on other demands of similar nature.
Joshi, however, also pitched for a higher share for income tax department from what it collects. "Currently the cost of collections stands at not more than 0.6% of the total mop up. In the developed countries, the costs of collection was up to 2%. It has been mooted to increase the quantum in India too. The money can be used for creating facilities both for tax collectors and payers, he said. Even a 1% rise in the cost of collection will be substantial," he said.
A proposal to have more posts in the apex grade for the Indian Revenue Service (IRS) officers has also been mooted. This is equivalent to a special secretary having a pay scale of 80,000.
"This is needed to bring IRS at par with other services like IAS and IPS. Even Indian Forest Service has 45 posts of this level," Joshi said. At present, the department only has higher administrative grade (HAG) level of officers at the top with pay scale of 67,000 to 70,000. A HAG+ in 75,000 scale has been demanded. The proposal will be forwarded to the cabinet by the department of personnel and training (DoPT), he added.