The economy is witnessing improvement across all sectors as reflected by a healthy 37 per cent increase in indirect tax collections during the first four months of current fiscal, Chief Economic Advisor Arvind Subramanian said today.
"These (indirect tax) collections indicate that the underlying momentum in the economy continues to improve across all sectors ...(and suggests) healthy increase in nominal GDP growth," he told reporters here.
Indirect tax revenue jumped over 37 per cent to over Rs 2.1 lakh crore in the April-July period this year on the back of higher excise duty collections.
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After discounting the impact of additional revenue realisation measures taken by the government in 2015-16 budget, the increase in indirect taxes was 14.6 per cent, the Chief Economic Advisor (CEA) said.
In April-July, the excise collections jumped 75.4 per cent to Rs 83,454 crore. While revenues from service tax rose 20.1 per cent to Rs 60,925 crore, those from Customs surged 21 per cent to Rs 66,076 crore.
The rise in indirect tax collections between April-July, Subramanian said, can also be partly attributed to additional measures like hike in excise duty on diesel and petrol and clean energy cess, withdrawal of exemptions for motor vehicles and consumer durables and increase in service tax from 12.36 per cent to 14 per cent with effect from June 2015.
"It also includes customs collections, which have also been helped by rupee depreciation of 6 per cent between April and July," Subranamian added.
He further said: "Stripped of all additional revenue measures, indirect tax collections increased by 15.2 per cent in July 2015 over July 2014, and by 14.6 per cent for April-July 2015 compared to April-July 2014."
For July 2015, indirect tax collections increased by 39.1 per cent year-on-year.
Answering questions on the impact of devaluation of Chinese currency Yuan to encourage its exports, Subramanaian said the policy makers world over would have to take note of the emerging developments.
"There is no doubt that China is responding to its own internal development of slowing down of growth and exports in order to give its economy a boost. All of us policymakers around the world, including India, have to take notice of this action," he said.
Subramanian, however, refused to comment on the impact of yuan devaluation on India and its exports.
