The exchequer is set to swell as the finance ministry today raised its tax collection target for 2010-11 by Rs 37,000 crore to Rs 7,82,000 crore. It also exuded confidence of meeting the target on the back of buoyancy in the mop-up so far driven by robust economic growth. The move is also intended to protect a decline in the tax-to-GDP (gross domestic product) ratio due to high inflation.
The government had budgeted its tax collections to touch Rs 7,45,000 crore at the end of March 2011. Of this, the Budget estimate for direct tax collections was Rs 4,30,000 crore, which is now revised to Rs 4,47,000 crore. The target for indirect tax receipts has been revised from Rs 3,15,000 crore to Rs 3,36,000 crore.
“I’m reasonably confident of achieving the target,” Revenue Secretary Sunil Mitra told reporters on the sidelines of a function for giving Presidential Awards to the officers of Customs and Central Excise.
The government had collected Rs 2.99 lakh crore from direct taxes and Rs 2.37 lakh crore from indirect taxes till December, constituting 69.53 per cent and 75.5 per cent of budget estimates, respectively.
Mitra expressed concern about a lower tax-to-GDP ratio on account of high inflation. He said average inflation was expected to be around 9 per cent for 2010-11, much higher than last year’s average of 3.8 per cent.
Wholesale price index-based inflation stood at 8.43 per cent in December. Food inflation abated a bit in early part of this month, but still remained at a high level of 15.52 per cent for the week ended January 8.
