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Industry body Assocham has asked the government to increase the personal income tax exemption limit in budget to

The Reserve Bank today appealed to the income tax assesses to pay dues in advance of the due date as well use alternate channels of authorised banks to avoid the rush during end of March.

Lord Meghnad Desai, the Indian-born, British labour party politician has made a strong case for abolishing Income Tax and instead made a strong case for a Consumption Tax.

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The government expects the direct

For the first time in five years, the government is likely to meet Rs 14.49-lakh crore budgetary tax collection target for 2015-16 with robust indirect tax mop up making up for the shortfall in direct levies.

“We are likely to exceed the collection in indirect tax by about Rs 40,000 crore in the current year. On the whole, we are very optimistic about achieving annual tax revenue target for the year,” Revenue Secretary Hasmukh Adhia said today.

The government invariably falls short of tax collection target and had last time exceeded the budgeted target in 2011 fiscal.

Of the Rs 14.49 lakh crore tax revenue target set for 2015-16, Rs 7.97 lakh crore was estimated to come from direct taxes (corporate and income tax) and another Rs 6.47 lakh crore from indirect taxes (customs, excise and service tax).

In the 10 months of the current fiscal, indirect tax mop up of Rs 5.44 lakh crore was 88 per cent of the full year target. Besides, direct tax collection of Rs 5.22 lakh crore was 65 per cent of target for 2015-16.

“Looking at the trend, it appears that as far as indirect tax collections are concerned, the government may get more than Rs 40,000 crore over and above the BE (budget estimate) target for indirect taxes for 2015-16 while there might be an equal amount of shortfall in direct tax collections.

“However, both direct and indirect tax collections put together, we expect to meet the annual BE target of Revenue collections for the current year without any shortfall,” Adhia said in a statement.

The April-January tax collection data shows an increase of 33 per cent in indirect tax and 10.9 per cent jump in direct tax collection, Adhia said.

“The tax revenue trends actually supports the latest figures of GDP growth rate,” he said.

The CSO has projected Indian economy to grow by 7.6 per cent in current fiscal, the fastest pace in five years.

In 2014-15, the government had targeted Rs 13.64 lakh crore in tax revenue but at the end of the year it was revised downwards to Rs 12.51 lakh crore. In 2013-14, tax collection targets were revised downwards to Rs 11.58 lakh crore from budgeted over Rs 12.35 lakh crore.

In 2012-13, budget estimates for tax revenue was over Rs 10.77 lakh crore, but it was scaled down to Rs 10.38 lakh crore in revised estimates. While in 2011-12 fiscal, gross tax revenues were budgeted at 9.32 lakh crore, but in revised estimates it came in as Rs 9.01 lakh crore.

In 2010-11, budgeted gross tax revenue of over Rs 7.46 lakh crore was exceeded in revised estimates which came in at Rs 7.86 lakh crore.

In April-January of current fiscal, the growth in customs duty revenue on electrical machinery was 34.4 per cent and in other machinery it was 27.8 per cent.

“These are indicators of new investment taking place in private sector. New investments are taking place in the country for which these machineries are imported,” Adhia said.

In the services sector, as against 27.2 per cent average growth rate, the growth rate in banking and financial services was 44.6 per cent.

In work contract services it is 39.9 per cent and in goods transportation services growth rate is 41 per cent.

“These are also indications of high level of economic activities taking place in the country,” Adhia said.www.taxxcel.com

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Income Tax Department has identified 4,000-5,000 foreign companies based in this megapolis that are not paying taxes on time, including due to tax disputes, and expects to soon recover from them dues totalling nearly Rs 8,000 crore.

With the region accounting for about one-third of the government’s total tax revenue collection, the Department is “trying its best” to collect the dues from Mumbai-based foreign firms before end of this fiscal, that is March 31.

“We are trying to collect the tax due from foreign companies. In Mumbai alone, there are 4,000-5,000 foreign companies which are not paying taxes properly,” principal chief commissioner of income tax and head of the Mumbai region, DS Saksena told PTI here today.

The Department has already collected Rs 23,000 crore from foreign companies so far this year and is hopeful of collecting the balance of around Rs 8,000 crore before March 31.

“We have already collected around Rs 23,000 crore from foreign companies and we are trying our best to collect the remaining Rs 8,000 crore by the fiscal-end,” Saksena said on the sidelines of an Assocham function here.

These tax dues have been caused due to disputes which include profit from international transactions and tax from permanent establishments, he added.www.taxxcel.com

Reserve Bank Governor Raghuram Rajan had last week said that multinationals were also responsible for tax controversies, saying their indulgence in avoidance as well as evasion results in prolonged battles.

“Occasionally there is government excess, but they are not the only ones who commit excesses,” Rajan said while delivering the 13th Nani Palkhivala lecture on ‘Strengthening the free enterprise’ here on February 4.

“Multinational corporations complain all the time of excessive demands about excessive taxation, but it is also true that MNCs across the world tend to find tax avoidance and sometimes tax evasion as appropriate techniques and therefore, there is a constant fight between government and MNCs,” Rajan had said.

Industry body CII has demanded a one-time 100 per cent income tax holiday of five years for manufacturing units in special economic zones, saying the government’s decision to impose MAT and DDT was not conducive for practical viability of units operating in SEZs.

“This will go a long way in motivating exporters to enhance and promote exports through their units in SEZs. In the backdrop of slowing demand in the international market and continuously declining India’s exports, regaining investor’s confidence in SEZ is very difficult,” CII said.www.taxxcel.com

“Over Rs 3 lakh crore have been invested by government and private enterprises and almost 33 per cent of India’s total exports are done through SEZs. Tax exemptions and provisions proposed in the Act have actually been the impetus for this huge investment,” Sanjay Budhia, Co-Chairman of CII National Committee on International Trade Policy and Exports, said.

The idea behind an SEZ was to give Tax-Free regime for the units put up/operating there in spite of numerous hurdles such as isolated and remote location, lack of social and physical infrastructure coupled with difficulty in procuring inputs from DTA (Domestic Tariff Area) and receiving drawbacks, he added.