Mumbai opens purse strings, pays 92% more corporate tax
July, 26th 2006
The Mumbai income tax department, which usually accounts for 35-40% of the all-India corporate tax mop-up, has registered an unprecedented 92% increase in corporate tax collection to Rs 2,514 crore for the three months ended June '06. The all-India figure during the same period is estimated at Rs 18,500 crore, a 75% rise over the corresponding period last year. The target set by the finance ministry for Mumbais I-T department for the whole fiscal is a minimum collection of Rs 46,000 crore.
"The tax collection is in tune with the Mumbai's collection target of Rs 69,000 crore," said Indira Bhargava, the new chief I-T commissioner. Ms Bhargava also said the amount refunded during the period was considerably less compared to the previous years.
One of the reasons for the quantum jump is the department has been able to streamline the TDS collection, thanks to the computerisation of the I-T department. The department got most of the TDS collection on time, including the bulk TDS from corporates.
The general buoyancy in the economy is the other contributing factor. With a zooming stock market, the all-India collection of STT surged to Rs 1,570 crore. The figure for the same for the corresponding period last fiscal was less than Rs 600 crore, marking a climb of over 250%.
Mumbai's personal tax collection, too, rose at an unprecedented rate to Rs 3,213 crore, a 70% jump. The figure for the same for the whole of India is a 42% increase to Rs 14,400 crore. The fringe benefit tax (FBT) from Mumbai is estimated at Rs 46 crore and securities transaction tax (STT) at Rs 1,214 crore.
The tax mop-up figure is an achievement of sorts, considering the fact that any rise between 20-25% over the previous period is generally considered very good. Since Mumbai accounts for a significant chunk of the all-India kitty, the revenue authorities hope to get past the overall target for the current fiscal, fixed at Rs 2,10,000 crore.