Following a major increase in direct tax collection last fiscal, the Indian government expects to substantially revise upward the estimate for the current fiscal.
"The Central Board of Direct Taxes (CBDT) will meet over the next couple of days and increase the estimate upward," Finance Minister P Chidambaram said on Monday after a meeting with the top officials in the direct tax administration.
The budget estimate for direct tax collections for the current fiscal has been set at Rs 3,650 billion and the finance minister said that there would be a need to hike the estimates even if one assumes a 25 per cent increase this fiscal.
"For 2007-08, direct tax collection was Rs 3, 144.68 billion. This represents an increase of 36.62 per cent over the previous fiscal, and 117.56 percent of the original budget estimates," he said.
"In four years, this has been tripled - that is from Rs 1,050.88 billion to Rs 3,144.68 billion. This is a remarkable achievement and I complement the department for this extraordinary achievement," he added.
"The cost of collection has come down to 0.54 per cent. For every Rs 100 collected, the department spends only 54 paise. Now this is the lowest in any jurisdiction in the world, Chidambaram said.
The country's tax to gross domestic product (GDP) ratio also increased from 2.68 per cent in 1999 to 6.67 per cent.
He said that there was a 51-per cent increase in tax deducted at source last fiscal, advance tax had gone up by 23.6 per cent and self-assessment tax by 62 per cent.