×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Union Budget 2008|IT collections to touch Rs5,000 cr in 2007-08

Union Budget 2008|IT collections to touch Rs5,000 cr in 2007-08
Comment E-mail Print Share
First Published: Tue, Feb 05 2008. 04 06 PM IST
Updated: Tue, Feb 05 2008. 04 06 PM IST
New Delhi: While revenue collections through personal income tax to the finance ministry are likely to rise by Rs5060 crore in fiscal 2007-08 to touch Rs87570 crore from Rs82510 crore in previous year, the number of income-tax payees in the period will jump by five million from 25 to 30 million, according to Assocham.
In the last 15-year period following initiation of tax reforms in 1991, there have been drastic changes in the rates of direct and indirect taxes thereby altering their respective shares in the total tax revenue. Changes in tax rates, increase in the tax base, introduction of new taxes and simplification of laws and procedures pertaining to the already existing ones has led to an increase in direct tax revenue of the government.
Share of direct and indirect taxes in gross tax revenue over the last 15 years post liberalization depicts that while at the dawn of liberalization, shares of direct taxes and indirect taxes in total tax revenue were 22.5% and 73% respectively, they have almost become equal (50% each) in the last fiscal 2006-07.
Projections
* 44.7% hike in IT collection expected for finance ministry by 2010 implying collections will rise to Rs119443 cr with number of tax payees exceeding over 45 mn
* Reason for projected growth both in terms of income-tax volumes and number of income tax payees for 2007-08 and thereafter would be mainly on account of rising levels of income which will widen tax base and voluntary compliance of IT payment, arising out of awakening factor as also fear psychosis because of strict monitoring that will follow from authorities concerned
* Projections for 2015 IT revenue generation would be three times more from the level of 2006-07 to touch Rs2,59,522 cr with the new IT code in place in next few years which will simplify procedures, reduce bureaucratic hassles and make income tax collection methods simpler for IT payees
* Share of IT in tax revenue to government shot up from 10% to 17% in the last 15 years during the period, when procedures and hassles for IT collections was not that simple; but now simplification would be a reality with IT payees reaching a projected level of 45 mn by 2010
* Openness in the administrative system will become more transparent and employment opportunities rise for people who will lead to multiplication in income levels
* With government monitoring system becoming more effective, tax evasion may become harder and compliance increase, resulting in multiplication of government revenues
* Higher number of people falling under IT net would be because of the fact that the service tax base is widening and it contributes roughly 54% to national GDP; with base of service tax payers widening, number of IT payees is likely to go up, adding to the government kitty
* Figure of corporate tax by 2010 would reach Rs2,04,784 from the level of Rs14,6497 cr in 2006-07 and register a growth of nearly 40%; revenue from this source may grow by over 3.5 times to Rs521630 by end 2015, depending on how government executes its promise of putting GST in place by 2010
Comment E-mail Print Share
First Published: Tue, Feb 05 2008. 04 06 PM IST