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Sinha urges Revenue Dept to meet tax collection target

Our Bureau

NEW DELHI, July 11

THE Finance Minister, Mr Yashwant Sinha, on Wednesday said the Revenue Department would have to ``deliver'' to ensure that the total tax collections are on course to meet the revised estimates (RE) this fiscal.

In the last financial year, there was a substantial shortfall in tax collections compared to even the RE.

Mr Sinha told the annual meeting of Chief Commissioners and Directors-General of Income-Tax on Wednesday that he had not expected the Central Board of Direct Taxes (CBDT) to lag behind.

Although revenue collection was a function of the state, the shortfalls in some areas such as corporate tax, had to be looked into, he said. The projected RE of Rs 74,000 crore for 2000-01 was based on the growth rate in the last quarter. However, the co llections feel short of expectations by well over Rs 5,000 crore.

The rising trend of direct taxes accounting for a higher share in the gross domestic product (GDP) was an encouraging sign and should be carried forward.

The lag in tax realisations during the first quarter was on account of large corporate refunds, Mr Sinha said. The Minister wanted the Revenue Department to bring more people in the urban areas under the tax net. The CBDT has already extended the one-by- six scheme to 4,600 cities and towns compared to 133 last year.

The Finance Minister said he was hopeful of a turnaround in the economy by the end of the calender year and consequently, higher tax realisation. The recent estimate of the Centre for Monitoring Indian Economy (CMIE) which had projected a growth rate of 6.3 per cent for the Indian economy was heartening, he said.

Referring to new measures taken for boosting the tax collections, Mr Sinha said he was aware of the criticism levelled against the Government for taxing perquisites (perks). ``What is forgotten is the fact that corporates conceal real income behind a vei l of different perks. Although the Government will be liberal and keep an open mind on this, we cannot allow tax evasion through perks through innovative means.''

The CBDT Chairman, Mr A. Balasubramanian, said the 18 per cent growth in tax collections during fiscal 2000-01 had fallen short of the budgeted estimates. The tax department would endeavour to further widen the tax base by focussing on Permanent Account Numbers for business indicators and extending the process of computerisation. The department expects to ensure electronic filing of returns by next year.

Picture: The Finance Minister, Mr Yashwant Sinha, with the Minister of State for Finance, Mr Balasaheb Vikhe Patil, at the All-India Conference of Chief Commissioners and Directors-General of Income-Tax in the Capital on Wednesday.

Picture by Ramesh Sharma