Madhya Pradesh has seen a rise in tax collection this year in spite of the recession. This has bolstered the state government to raise its tax collection target to Rs 16,000 crore.
State Finance Minister Raghavji said value added tax collection is expected to touch Rs 11,000 crore this year.
“There is a surge in tax collection as number of tax payers has gone up after the rationalisation of state taxes. We have raised the tax collection target this year from Rs 9,000 crore to Rs 11,000 crore,” he said. He claimed better fiscal management has helped the state remain insulated from the recession. This year the total tax collection in the state is expected to touch Rs 16,000-17,000 crore.
Last year the collection of value added tax, entry tax and central sales tax stood at Rs 8,154 crore, which has now risen to Rs 9,202 crore. The target was revised during the later part of March this year and is now pegged at Rs 11,000 crore for the year 2010-11.
The excise tax collection also swelled from Rs 2,299 crore to Rs 2,952 crore this year. The tax collected by registration of properties and other such activities has gone up to Rs 1,785 crore from the last year’s Rs 1,484 crore. “In fact schemes like Bhamashah Award for honest tax payers have brought confidence and raised faith among the honest tax-payers in the state. A large number of firms, companies and enterprises have willingly come forward to pay taxes. This has never happened before,” said the minister.
The central sales tax collection this year has gone up from Rs 516.65 crore to Rs 536.24 crore. This tax will be phased out by the end of year 2011. The entry tax collection has also gone up from last year’s Rs 1,327 crore to Rs 1,331 crore. “A large number of frauds are still taking place among traders, corporate houses and firms in the state at an alarming level. Until a proper and technology-based monitoring system is not developed, the state will have to suffer on the tax revenue collection front,” a senior official said.
The minister admitted to lapses in the tax collection system. “Fraud is a big issue for a state like Madhya Pradesh. But the problems related to tax collection will soon be ironed out with computerisation of the process and proper training being given to the department officials.”