Big corporations will now find it difficult to defer their advance tax payments. In a bid to meet its revenue collection targets, the Central Board of Direct Taxes (CBDT) has decided to monitor advance tax payments by top companies and persuade them not to defer such payment as self-assessment tax for the next financial year.
CBDT convened a meeting of chief commissioners of income-tax today to discuss strategies for achieving the revenue collection target budgeted at Rs 3.7 lakh crore for the current financial year (2009-10) and internally reset at Rs 4 lakh crore.
The strategies discussed during the meeting also included monitoring tax payments of loss-making companies, liable to minimum alternate tax (MAT) at an enhanced rate of 15 per cent, and persuading them to make such payment as advance tax during the current financial year. They also decided to monitor tax deducted at source (TDS) deposits by private deductors as well as state governments and local bodies.
The government said it would also focus on the collection of tax arrears, as well as tax demand raised in scrutiny assessments during 2009-10.
The meeting was addressed by CBDT Chairman S S N Moorthy, and was also attended by newly-appointed Revenue Secretary Sunil Mitra, the finance ministry said in a statement.
Direct tax collections in the first nine months (April-December) of 2009-10 rose 8.51 per cent to Rs 2,50,232 crore, compared with Rs 2,30,598 crore in the same period last financial year. The growth was driven by corporate tax collections, whereas the receipts of personal income-tax dipped.
The revenue department will have to collect over Rs 1.2 lakh crore as direct taxes in the next three months to meet its target of Rs 3.7 lakh crore.
Last year, the government had missed its target of Rs 3.45 lakh crore due to the economic slowdown, but this year it is betting on direct tax collections to make up for any shortfall in indirect tax receipts, which are also likely to miss the target.