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PMO seeks fin min suggestions as tax mop-up slumps, meeting on Mon

Thursday, Jul 9, 2020

 

–Source: Fin min to suggest revenue raising measures at meet with PMO

–Fin min to make presentation to PMO on revenue position

 

By Shubham Batra and Adrija Chatterjee

 

NEW DELHI — At a time when the COVID-19 pandemic has severely dented government's tax collections, the Prime Minister's Office has sought suggestions from the finance ministry to augment revenues, a senior government official said.

 

Prime Minister's Principal Secretary P.K. Mishra will hold a meeting with senior officials of the finance ministry on Monday on revenue positions and possible measures to improve revenues.

 

The PMO has asked the finance ministry to propose measures to minimise the shortfall in tax collections in the current financial year, the official told Cogencis.

 

The central government's gross tax collections fell 41.2% on year to 1.261 trln rupees in Apr-May as the economy came to a near standstill due to the nationwide lockdown to prevent the spread of COVID-19, according to latest available data.

 

The Budget has set a tax collection target of 24.230 trln rupees in 2020-21 (Apr-Mar), up 20.6% from 20.099 trln rupees raised a year ago. The tax collections in 2019-20 were a whopping 4.513 trln rupees lower than the Budget target.

 

The biggest drag has been the goods and services tax collections, which fell 41.0% on year to 1.852 trln rupees in Apr-Jun.

 

According to the official, the government is yet to assess the likely shortfall in tax collections in the current fiscal, but initial trends suggest that the government may have to push Budget targets sharply lower.

 

"Any detailed assessment of the shortfall can be made only when we see overall improvement in demand once the lockdown is lifted fully and coronavirus cases reduce," the official said.  End

 

Edited by Shirsha Thakur

 

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