Sept excise mop-up declines

If this trend continues, collections may fall short of the annual target of Rs 1,36,610 cr.

Central excise duty collections have declined 3.8 per cent to Rs 9,800 crore in September this year, as compared with Rs 10,186 crore in the same month last year, reflecting a slowdown in industrial production.

Excise duty collections grew 2.3 per cent between April and September 2008-09, as compared with 6.5 per cent in the same period last fiscal. “If this trend continues, excise duty collections may fall short of the annual target of Rs 1,36,610 crore,” said a revenue department official. Excise duty collections need to grow by 9.3 per cent to achieve this target.

“Lower excise duty collections may be on account of a slowdown in industrial activity. Possibly, this trend may continue for a few months,” said Vivek Mishra, partner, Ernst & Young.

India’s industrial production expanded 1.3 per cent this August, the slowest in 10 years.

Service tax collection numbers for August, the latest month for which data are available, also indicate a moderation. Service tax collections grew 13.1 per cent in August (at Rs 3,702 crore), compared with 23.3 per cent in the same month last year. The growth is 25.9 per cent in April-August (at Rs 23,051 crore), closer to the growth rate needed to achieve the service tax collection target of Rs 64,460 crore in 2008-09.
 

EXCISE AND CUSTOMS COLLECTIONS (RS/CRORE)
	Revenue Realised Sept. 2007

Revenue
Realised
April-Sept,
2007

Revenue
Realised
Sept.
2008

Revenue
Realised
April-Sept,
2008

%
Growth

Sept

April-Sept

Customs79754848096215735620.618.3 Excise*1018654654980055923-3.82.3 Total18161103134194211132796.99.8

The only exception is Customs duty. Customs duty collections have grown by 20.6 per cent in September, significantly higher than 4.9 per cent in the corresponding month last year, mainly on account of the depreciation of the rupee and a higher oil import bill.

“This is a blip and it may see a correction as oil prices are coming down and non-oil imports are likely to decline,” Mishra said. Cumulatively, Customs duty collections grew by 18.3 per cent in April-September this year. This is higher than the 14.4 per cent required to achieve the annual target of Rs 1,18,930 crore.