Central receipts from direct taxes in the first two-and-a-half months of the current financial year till June 15 registered a 27.3 per cent growth in spite of higher base effect over the corresponding period last year, and as against the 26 per cent growth targeted for the full year.
Disclosing this here on Friday, Sunil Mitra, finance secretary, said he was confident of sustaining the initial tax growth till the last quarter of the current fiscal. This was enough to meet all the obligations, including clearance of total tax refund payouts amounting to Rs 105,000 crore due for the last two years, he added.
According to Mitra, gross tax collections during April 1 to June 15 stood at Rs 75,521 crore, even though the corresponding period in last year witnessed unusually high rate of growth. Customs registered 41 per cent growth followed by central excise with 34 per cent and service tax collections grew 30 per cent. Corporate tax was up 28.6 per cent and personal income tax collections rose 25.5 per cent during the period. Indirect taxes showed a higher growth of 37 per cent.
Mitra explained these figures to substantiate his stand that there was no slowdown in the economy, barring a few sectors. He also said the government would be in a position to make the remaining payouts of Rs 65,000 crore tax refunds without borrowing any extra penny, as they were on course to collect the targeted Rs 5.32 lakh crore direct tax for the year.
Clarifying media reports that he was opposed to tax refund payouts, Mitra said he was only stating that the government should not create a situation for itself to borrow money at 8 per cent interest for refunds. Mitra was here to deliver a public lecture on tax reforms, organised by the Administrative Staff College of India (ASCI).
Black money Responding to questions on black money, Mitra said conditions were being created to achieve this by both renegotiating the existing double taxation avoidance Act and checking on the sources of black money generation within the country. A web has be built and operated so that no person is allowed to stash unaccounted money either in India or abroad.
In the last two years, the Income Tax department had unearthed Rs 30,000 crore worth of undisclosed income while another Rs 34,000 crore had been detected in the form of trade mis-pricing in last one-and-a-half years, the single biggest channel of siphoning off money to other countries. These are a part of measures aimed at containing the generation of black money, he pointed out.
He said 50 of the 65 double taxation avoidance agreements and 22 tax information exchange agreements with the respective countries had already been renegotiated and finalised to share the information of money accounts of persons and firms.
At present, the sharing of such information with 97 countries is only to be used for taxation purposes, therefore the government is renegotiating the agreements to use the information for other purposes as well. Mauritius, one of the well known tax havens, has also agreed to renegotiate the double taxation avoidance agreement and Switzerland too would allow information sharing after the ratification of the agreement in December this year, according to Mitra.
The government is also setting up 8 new overseas tax centres in countries like the US, UK and Germany, he said.