Indirect tax collections climb up by 65 pc this year: CBEC chief
July, 23rd 2008
The taxes should not be considered as a hurdle in economic growth of the country because the revenue generated from direct and indirect taxes is either spent on states or welfare of the public, said P.C. Jha, Chairman, Central Board of Excise & Customs, while delivering a lecture at Ludhiana Management Association yesterday evening.
P.C.Jha was invited by Ludhiana Management Association along with Ludhiana branch of NIRC, the Institute of Chartered Accountants of India, to deliver a lecture on the topic Indirect taxation - an instrument for economic development, to the members.
While talking about the role of indirect taxes in economic development of the country, P.C. Jha, Chairman, Central Board of Excise & Customs, said that the growth of economy was directly proportional to the growth of revenues from the taxes. The total collection of revenue from indirect taxes in the current year has touched Rs 2,89,000 crores approximately, which includes Rs 1,40,00 crores from Customs, Rs. 1,25,574 crores from Excise and Rs. 51,113 crores from Service Tax.
Jha said that the collections of current year were 65% higher than the previous year. For the year 2008-2009, it is expected to receive Rs 3,20,000 crores of revenue from the tax collection with an expected growth of 14.1%. Jha further informed that it was being expected that Customs would be able to collect tax revenue worth Rs 1,18,000 crore, excise would collect Rs 1,36,610 crore while service tax collection would reach Rs 64,000 crores in the coming year.
Jha said customs and excise were two kind of indirect taxes which are available from the early times of civilization, however, service tax was a new tax added to the category of indirect taxes.
Jha said that service tax was introduced in 1994 with three services on the list and total collection was Rs. 410 crores but presently there are 106 services, which are taxable, and the revenue collection has touched Rs 65,000 crores. Jha also remarked that the collection from direct taxes has been higher than indirect taxes in the country, which is a good sign of development.
The chairman said that the government believed in the policy of low rate of taxes and high rate of compliance. Jha said that the tax rates for customs had come down drastically from 300% in 1991 to 10%, Excise rates from 110% in 1989-90 to 14%. Only the rate of service tax has increased from 5% in 1994 to 12.36% at present because of the stupendous growth of service sector. Jha urged the industry and professionals to come forward and cooperate with the department for the growth of economy.
A.K. Mehra, Commissioner, Central Excise, Balbir Singh, Tax Consultant from Delhi, CA Vishal Garg, Chairman, Ludhiana Chapter of ICAI, CA Harinder Singh, Secretary, Ludhiana Chapter of ICAI, Dr. K.N.S.Kang, General Secretary of LMA and Anil Kumar, President, LMA were present on the occasion.