New Delhi: Finance Secretary R S Gujral has expressed hope that the direct tax collection target of Rs 5.7 lakh crore for the current fiscal will be achieved on the back of good performance from sectors including, cosumer goods,on software, cement and oil companies.
"The 15 percent growth in our direct taxes target is not unachievable and it is not that difficult at all," he said in his address to senior officials of Income Tax Department.
Gujral said "off hand I would say the sectors which are positively likely to do well and show growth" this fiscal include consumer goods, software, cement, infrastructure, banks, oil companies and steel, among others.
He said performance of software companies, which did well last fiscal also, is likely to be good on account of rupee depreciation, while the decline in crude oil prices is good for oil marketing companies.
Direct tax collections in 2011-12 was about Rs 4.95 lakh crore, marginally short of the downwardly revised target of Rs 5.05 lakh, as some sectors were "extremely stressed" and accordingly tax revenue from them declined significantly.
"With a growth of 6.5 percent (in 2011-12) and with inflation of at least 7.5-8 percent our collection for direct taxes should have been higher. The tax-GDP ratio declined marginally, which should not have occurred," Gujral said.
Gujral further pointed out that "there are certain sectors which will continue to do poorly (in this fiscal also). At least we do not anticipate too much of improvement in the current year".
He said certain banks, some steel companies and capital goods firms and iron ore and aluminium companies are also likely to perform "badly" this fiscal year.
Referring to rising fiscal deficit and widening current account deficit and the issue of black money, "clearly if we have to tackle the these problems there is a need to augment the revenue significantly but simultaneously also ensure that we spur growth", he said.
"There is a need for balancing tax collection with reasonabilty," he added.
He further said income tax refunds are likely to be lower this fiscal as compared to Rs 95,000 crore in 2011-12. In the first two months of the current fiscal, the refunds were Rs 1,600 crore, much less than the previous year.
On General Anti-Avoidance Rules (GAAR), implementation of which has been deferred till the next fiscal, Gujral said the provisions has created an impression in the minds of the public as if the Income Tax Department is likely to be given unbridled powers which may trouble honest tax payers.
"We need to ensure that does not happen," Gujral said and asked officials to make sure that there is no misuse of GAAR.