Customs all smiles as revenue mop-up jumps on Rupee pains
Mumbai: At least one arm of the harried North Block is a happy lot amid the falling rupee and is looking at it as a blessing in disguise, as the Customs Department is witnessing a near double-digit uptick in revenue collection.
The good news comes to the Customs Department as the value of the imported goods goes up, there is a commensurate increase in their revenues as well, says a top official. Due to this, the department is confident of achieving its targets for the fiscal, the official added.
"Exchange rate fluctuations have worked to our advantage because the values have gone up. There is an 8 percent increase in values. Automatically there is an uptick in the amount of taxes we were collecting (as) the valuation changes," member and special secretary of the Central Board of Excise and Customs Sheila Sangwan, told PTI here.
It can be noted that the rupee has lost close to quarter of its value since the beginning of this fiscal.
Sangwan, who reviewed the custom duty collections in the financial capital over the weekend, said the department will meet its share in the indirect tax collection this fiscal.
She said the container port JNPT, which is also the largest contributor to the customs kitty, is witnessing a growth of 10.4 percent this fiscal.
The customs at the city airport, also among the biggest of the air terminals from a revenue collection standpoint, is also doing well, she said.
When asked if the recent measures to squeeze imports with a view to reduce demand for dollar will affect the revenue collection, she replied in the negative, saying there are many more avenues apart from gold and silver through which department can earn revenue.
Given the economic slowdown, Sangwan sounded concerned over the overall indirect tax collection growth target of 19 percent to Rs 5.65 lakh crore, acknowledging that growth is not on course in the first few months of the fiscal.
"We are short of the target, there is no doubt over that. But we are catching up," Sangwan said, adding the first few months of every fiscal tend to show a muted growth as the department tackles with issues like disbursing refunds.
According to the official data, indirect tax collections were up 4.7 percent in the June quarter over the same period last year at Rs 1.11 trillion.
The service tax department, which is getting an increased attention from the revenue mop-up standpoint this fiscal, is also not performing at par with the targets, Sangwan said, but exuded confidence that things will improve as the year progresses.
On the service tax front, where the finance ministry is targeting an increase of 36 percent in revenues to Rs 1.81 trillion, will receive a surprise help from the service tax voluntary compliance encouragement scheme announced in the budget, she said.
The government has already received requests from 660 companies under the amnesty scheme through which it will collectively raise up to Rs 660 crore, she said.
The exact picture of the companies volunteering to come up with past dues and paying up will be known by mid-November, she said.
"The window closes in December and it entails a payment of 50 percent of the dues within a month. So nobody would like to get the money stuck in advance," she said.