Tax mop-up target for 2003-04 likely to be met

The Centre is almost certain to meet its revised tax revenue targets for the fiscal 2003-04, based on a sharp rise in collections in March.

This will be the first time in more than a decade that the Centre will exceed its original Budget target of tax receipts.

The flash figures of direct tax collections, including corporate and income tax, till today is above Rs 1,02,000 crore, which is just about Rs 1,300 crore lower than the estimate of Rs 1,03,255 crore.

Finance ministry officials said these were provisional figures and the government expected another Rs 2,000 crore, to be realised from cheques yet to be cleared by banks.

The picture is optimistic on the indirect tax front too. The excise duty receipts for 2003-04 has touched Rs 91,250 crore, against a target of Rs 92,379 crore, despite steep cuts in duties, particularly steel. A finance ministry official said the steel duty cut cost the government about Rs 1,000 crore as duty.

He said because of the rise in imports, Customs duty receipts for the year reached Rs 48,600 crore, within sniffing distance of the revised target of Rs 49,350 crore.

The other major component of indirect tax --service tax -- has also touched Rs 7,600 crore, which is just Rs 700 crore short of the target of Rs 8,300 crore for 2003-04.

Officials said the largest component of the service tax receipts was contributed by telecom companies at about Rs 3,000 crore.

This will be the first time over the past two decades that the Centre will be able to cross its original budgeted collection target.

Ministry officials, expressing pleasure about the trends in receipts, said it was a combination of factors including the economic recovery which had led to the rebound.

This included a healthy industrial output, increased profitability of corporates and a regime of low interest rates. They also said enhanced pace of refunds, a toned up tax administration, besides tightening of controls in administration had played a part in the process.

Speaking about the trends in direct tax receipts, a ministry official said if one compared 2003-04's total receipts with total collections of 2003-03, there is an increase of 26.8 percent.

He said the government was expecting direct tax revenue to keep up its momentum of growth in 2004-05 also, with a 26 percent increase in corporate tax, and 15 percent in income tax receipts, with the existing tax rates.