Tax Receipts Lower Than Expected
Feb. 11 – A slowdown in manufacturing and exports has resulted in the Indian government collecting lower than expected direct taxes during the April-January period. Annual taxes are accounted for at the end of the fiscal year in India which runs from April – March.
Last year, the government set a target of 20 percent growth in corporate tax receipts to Rs 2.26 trillion rupees (US$46 billion) and a 14 percent rise in income tax collections to Rs 1.39 trillion (US$28.5 billion) during financial year 2009. The target for total receipts was Rs 3.65 trillion (US$75 billion).
"The direct tax collection touched Rs 2.47 trillion (US$50.7 billion) as on February 1, growing by a lower than expected 12.5 percent," S.S.N. Moorthy, the chairman of Central Board of Direct Taxes told Reuters.
Tax receipts were up 39 percent until the June quarter. They then began to recede as the financial crisis took its toll on the nation. The Indian government was particularly looking forward to an increased tax collection as it has pledged to spend an extra Rs 1.47 trillion (US$30 billion) in financial year 2009, and has foregone revenues by cutting excise duties by four percent in December. To increase revenues, the government has also decided to sell 460 billion rupees (US$9.44 billion) of additional debt by March 20.