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Direct tax collection unrealistic without revision: Who is to be blamed?

By Rakesh Ranjan- 22 Apr 2020
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The economy of the country is collapsing and it is unlikely that the government will be able to match the Direct Tax Collection even of any of the past three years’ tally. It is for sure going to remain lower than the past 3-4 year’s collection.

Director IT-Budget Mahesh Kumar has written to all principal chief commissioner of IT that the statistical growth rate for a region has been further moderated by averaging it out with the all-India targeted growth rate so as to narrow the gap between all-India growth and the target growth rate given to the region.

But in a changed scenario how tenable this tax recovery target will be that is a big question. The target set by the government in the budget for 2020-21 tax collection was Rs 13.19 lakh crore with almost one third from Mumbai only which is worst affected by COVID-19 halting every economic activity.

A senior IT official told Indianmandarins that CBDT should have revised the budget estimates as he feels meeting the budget target is unlikely and impossible. But now IT officials would be under immense pressure to go aggressive and target businessmen.

Another senior officer said that when there are already massive layoffs of employees, how would there be personal income tax collection? There will not be any salary revision in any sector with massive salary cuts. All these things should have been factored into by the CBDT but as per Pandey’s instruction, CBDT sent the letter with zone wise targets without realizing reality on the ground.

(By Rakesh Ranjan)

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