Notwithstanding slowdown, the Punjab government expects buoyancy in tax collections in the current financial year. The state government expects to garner Rs 23,842 crore (Budget estimates) in form of various state taxes in the financial year 2012-13 as compared to Rs 20,310 crore during the previous fiscal, a rise of over 17 per cent.
The state government is hopeful to garner the targeted revenue by better tax administration and tax compliance. It also indicated there is also scope for rationalising some taxes and levies.
Earlier, presenting his maiden Budget, Finance Minister, Parminder Singh Dhindsa said, “We are also planning to take steps to mobilise additional resources which may include imposing of new taxes like a license fee of Rs 1 lakh per annum on mobile towers. All the decision related to mobilisation of additional resources will be taken in the forthcoming Cabinet meeting and a final decision will be taken after taking into confidence the SAD-BJP alliance.”
Among state taxes, the value-added tax (VAT) is a major source of revenue followed by state excise and stamp duty & registration fee. In 2012-13, the government expects to collect Rs 14,213 crore as VAT compared to Rs 11,911 crore in 2011-12.
Petroleum products are one of the major source of VAT for the state. During the year 2010-11(projected), the consumption of petrol in the state was 5,89,816 metric tonnes, a growth of 6.10 per cent over 2009-10. The finance minister feels that increase in petrol prices coupled with increase in consumption will lead to an increase in VAT collection from petroleum products. According to excise department, there will be an increase of Rs 120 crore in revenue with the hike in petrol prices. Punjab, which levies one of the highest tax rates on petrol, earns Rs 1,800 crore annually as VAT on petroleum products. On petrol, state charges 27.5 per cent VAT, 10 per cent surcharge and 1.5 per cent infrastructure development cess making it 31.25 per cent.
It is also targeting to collect Rs 3800 crore as excise revenue in the current financial year as compared to Rs 3,250 crore during the previous year. As far as revenue from stamp duty & registration is concerned, it hopes to collect Rs 3375 crore this year in comparison to Rs 2900 crore the previous year.
Sources added this could be possible only because of rationalisation of tax structure besides checking the leakage. The state is also streamlining the revenue collection machinery besides blocking the loopholes to boost the revenue growth in the state.
According to a PHD Chamber study, by plugging loopholes of tax evasion among traders, states would be able to augment revenue during this year.
In order to put a check on tax evasion, the excise department should keeping a tab on transaction done by the Industrialists and traders, said the study.
