)
The Centre’s indirect tax collections grew 39.1 per cent, the fastest pace in three months, in July on robust pickup in excise duty mop-up, data released by the ministry of finance showed on Tuesday.
The rise was more on account of petroleum and diesel excise duty hike instead of a recovery on the manufacturing side and increase in the service tax rate to 14 per cent against 12.3 per cent from June.
The indirect tax collections rose to Rs 56,739 crore in July compared to Rs 40,802 a year ago. Besides, the indirect tax collection, which is a sum of revenue from service tax, excise duty and customs, posted a 37.6 per cent growth in the first four months of the current financial year to Rs 2.1 lakh crore. It is 32.6 per cent of the Budget Estimates (BE) for 2015-16.The central excise collections rose 65 per cent to Rs 22,273 crore in July over Rs 13,512 crore a year ago.
In the first four months of the financial year, the mop-up registered a 75.4 per cent increase to Rs 83,454 crore, which is 36.6 per cent of the full-year BE. The series of hikes in oil products gave the government additional sources of revenue, even as the manufacturing remains subdued on weak investments and domestic consumption.
The government had raised excise duty on petrol and diesel four times between November 2014 and January 2015, as the global crude prices crashed to a low of $45 per barrel.
Besides, the excise duty increase in fuel, duty exemption from automobiles and consumer durables was withdrawn from January 1 this year. It also helped the government contain the fiscal deficit to four per cent of gross domestic product in 2014-15 to Rs 5.01 lakh crore. As part of the roadmap for fiscal consolidation, the government has set a target of 3.9 per cent of GDP in the current financial year, then to 3.5 per cent in 2016-17 and further to three per cent by 2017-18.
The manufacturing recovery is yet to take off with the index of industrial production posting a muted growth of 2.7 per cent in May compared with 3.4 per cent in April, data released by the Central Statistics Office (CSO) showed last month.
