Active Stocks
Fri Sep 22 2023 15:58:38
  1. Tata Steel share price
  2. 126.7 -0.86%
  1. HDFC Bank share price
  2. 1,529.2 -1.57%
  1. State Bank Of India share price
  2. 598.1 1.67%
  1. Power Grid Corporation Of India share price
  2. 199.1 -1.34%
  1. Tata Motors share price
  2. 621.1 -0.93%
Business News/ News / World/  CBIC steps on the gas to shore up revenue collections for FY21

NEW DELHI : Facing a 1 trillion revenue shortfall, the Central Board of Indirect Taxes and Customs (CBIC) is pulling out all stops to try and shore up revenue collections in the last fortnight of the fiscal.

CBIC has told staff to postpone any leave plans and to make themselves available for meeting the challenges of revenue collections as the financial year comes to an end.

CBIC last week held a meeting of its members and senior field officers on ways to improve tax receipts and has now asked officers to nudge businesses to ensure they file their goods and services tax (GST) returns by the due date in March and to pay taxes on time, said a person informed about the development.

Tax Shortfall
View Full Image
Tax Shortfall

With restrictions on use of tax credits and a campaign against fake invoices, CBIC is hoping to achieve buoyancy in revenue receipts in an exceptional year of economic contraction.

CBIC on Monday informed field officials that a gentle nudge to taxpayers to file returns will add impetus to revenue collection, the person said.

The focus is on sensitizing businesses of their tax return filing and payment obligations, get pending tax assessments completed and ensure importers pay duty and clear goods that are assessed. Officials have also been told to levy interest on late payment wherever applicable, said a second person, who also spoke on condition of anonymity.

Officials have been told to contact businesses whose tax payments are sharply lower this year than last year’s and find out the reason. Stronger action is being taken in terms of issuing tax demands where mismatches have been noticed between different return forms on the sales made. The approach is also the same where there are mismatches between tax credits claimed and what is automatically generated in a tax credit statement as eligible tax credit.

“Many taxpayers have received communication from officials gently enquiring about the quantum of taxes paid especially if it is lower than last year’s payment and gently persuading them to contribute more to the exchequer. No coercive action, however is noticed in cases where assessments are not completed," said Rajat Mohan, senior partner at chartered accountants firm AMRG & Associates.

The efforts come in the wake of the finance ministry having to revise down its indirect tax revenue target for FY21 sharply from nearly 11 trillion to 9.9 trillion owing to the economic downturn induced by the pandemic. Both customs duty receipts and GST receipts in FY21 are expected to be short of the target set in last February by about 19% and 25% respectively. The saving grace is excise duty receipts, mainly from petrol and diesel, which is expected to be 35% above the target set for this fiscal and 50% more than what was collected in the previous fiscal, as per budget documents.

The drive to boost tax compliance and to check tax evasion by use of fake invoices has already shown results with GST receipts of the Centre and states crossing 1 trillion a month for five months since October.

"Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!" Click here!

Gireesh Chandra Prasad
Gireesh has over 22 years of experience in business journalism covering diverse aspects of the economy, including finance, taxation, energy, aviation, corporate and bankruptcy laws, accounting and auditing.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Updated: 17 Mar 2021, 05:11 AM IST
Next Story
Recommended For You
Switch to the Mint app for fast and personalized news - Get App