Economy will turn around by year-end: Sinha

By Our Special Correspondent

NEW DELHI, JULY 11. The Finance Minister, Mr. Yashwant Sinha, today said that the economy will turn around by the end of the year because of the measures initiated in the Budget and the likely improvement in the international economic scenario.

At a conference of Chief Commissioners and Directors- General of Income Tax here today, he said he was confident that the Government would be able to ride over the problems facing the economy. Once the economy improved, revenue collections would also go up, Mr. Sinha said, even as he regretted that tax collections had fallen short of the target in the last fiscal.

Though he attributed the shortfall to other factors, he said, ``Quite frankly, I did not expect the Central Board of Direct Taxes (CBDT) to lag behind. Revenue collections were not up to expectations.''

He stressed on the need to expand the tax base and outlined plans to double the number of taxpayers in the next three years. One measure was the extension of the one-by-six criteria to all urban areas. Under this scheme, the filing of returns was compulsory in case a person fulfilled one of the six listed criteria - ownership of property, motor vehicle, telephone or credit card, club membership above a specified amount or those who had travelled abroad or had financed somebody's travel abroad. If the number of taxpayers was doubled, the IT collections could go up to Rs. 60,000-70,000 crores annually.

The Minister called upon the CBDT to make efforts to improve corporate tax collections, which also had been lagging behind.

Mr. Sinha defended the decision to impose tax on perquisites, saying a lot of money was involved in this. ``There has been criticism from certain quarters, but what is forgotten is that the corporates have a habit of concealing certain income by way of perks.''

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