New Delhi: Increasing subsidy burden and figures of current revenue collection indicate that fiscal deficit is going to lower than even the worst of estimation. The recent data of direct tax collections points out that fiscal deficit is going to be 1 percent higher than the pre-defined target of 4.6 percent for the FY 2011-12.

After seeing the progress of direct tax collections till now, CBDT (Central Board of Direct Taxes) Chairman Laxman Das has written to all senior Income Tax officials that they should make every attempt to match the projected tax collection figures for the year. The government has set a direct tax collection target of Rs 5.32 Lakh crore for the current FY. There will be incentives for the officials playing major role in achieving target. They will be given choice of posting.

According to the recent data of CBDT, in the first nine months of the current FY direct tax collections of Rs 3,46,959 crore has been done. It is only 9.28 percent higher than the collected figures in the same period of last FY. Hence tax officials have set target of collecting Rs 83,000 crore in the last two months which according to CBDT officials is unachievable. However, senior Income Tax Officials have started fresh approach towards increasing tax collections.

Not only direct taxes like income tax and corporate tax, but indirect taxes like excise and customs also do not have an encouraging collection figure. In January 2012, custom taxes have seen a growth of 2.5 percent.  Service tax collection grew by 34.2 percent. However, there has been 1.1 percent decline in central excise duty collections. Since industrial production has been slow, growth rate in excise duty collections is expected to be slow in the next two months. In the period of April to January, indirect tax collection has seen a growth of 15.1 percent. For the current FY indirect tax collection target has set at Rs 3,92,908 crore. In ten months, 80 percent of the target has been achieved.

The government’s subsidy bill is also cause for worry which is close to Rs 1.30 lakh crore. Increasing cost of crude oil and fertilizers can put the government with an extra burden of Rs 80,000 crore.  

(JPN/Bureau)