Slowdown blues: Direct tax mop-up growth slumps to 3.5% till mid-October

The government might be impelled to steeply cut its direct tax collection target, with growth in this regard slumping to 3.5 per cent up to mid-October from the same period in the earlier financial year, as against the Budget target of 17.3 per cent. The year formally began on April 1.

A combination of factors is responsible. This includes a deepening of the general economic slowdown and corporation tax cuts. Collection will have to rise by 30 per cent in the remaining period of the financial year to achieve the Budget estimate. 

Last months's rise in direct tax collection was five per