Revenue Secretary Tarun Bajaj on revenue estimates, capital gains etc

Q1: Are you keeping your projections for next year conservative and hoping to achieve much higher actuals?
Ans:

• Estimated 9.6% growth in revenues for next year includes excise duties
• Excise duty is anticipated to go down by almost 15% – from Rs 3.94 to about Rs 3.35 lakh crores
• Significant revenue earning from capital gains tax this year 
• Last year, earning form capital gains tax was around Rs 7,000 crore

 
 
Q2: It is assumed that corporate and personal income tax will grow by 15% in the next year. Is that a conservative estimate or a realistic estimate?
Ans:

• 15% growth in income tax is a challenging target and has rarely happened in the past 
• Tax-to-GDP ratio this year is likely to be 11+%
• Little less than 1.3 is the estimated tax buoyancy for next year

 
 
Q3: So far, the government has not conducted an analysis of individual taxpayers who have shifted to the new tax regimen. But there has been a similar exercise on corporate tax. Can you share how many corporates shifted to the new tax regimen?
Ans:

• Of the corporate tax for 2020, which was filed on 2021, 65% of the income and 16% of the assesses shifted to the new tax regimen
• People with higher income have moved to the new tax regimen 
• Individual tax payers will move to the new regimen as they exhaust tax exemptions

 

Q4: On the personal income tax front, what is the plan for the department going ahead? Will you push the new regime?
Ans:

• Govt wants to push the non-exemption regimen and also analyse the data
• New regimen has larger slabs and is aimed at paying less tax 

 

Q5: There has been a demand for streamlining of capital gains tax. Presently, the definitions of long and short-term gains are different for bonds, equities and real estate as well as the rates. What is the government thinking on this?
Ans:

• Govt should consider streamlining of capital gain tax and introduce parity on some items of financials and non-financials
• Need to analyse what asset is for long term and which are the ones for short terms
• Industry should have the capacity to accept certain principle decisions taken by the govt

 
 
Q6: For the first time, you are told to tax a sector on which the regulations are awaited. What is your idea of how much you could generate from the 30% on crypto transactions?
Ans:

• All activities need not be regulated, and unregulated activities can be taxed as well
• No data estimates on how much 30% tax on crypto transactions will be like
• The tax will avoid disputed between departments and assesses
• Cryptos are not contributing to economic value as much as debt or equity 

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