Report / Government may face a decline in direct tax collection for the first time in two decades

• The Modi government was expecting a direct tax collection of Rs 13.5 lakh crore by March 31, 2020, a 17% increase over the previous financial year.
• At present, there is a lot of pressure on companies to cut investment and jobs, due to which the government will be able to achieve a growth of only 5% this time.

Mumbai. News agency Reuters on Friday released the report quoting sources about the country’s tax collection. According to this, for the first time in two decades, the Indian government may face a decline in corporate and income tax collections. Prime Minister Narendra Modi’s government was expecting a direct tax collection of Rs 13.5 lakh crore by March 31, 2020, a 17% increase over the previous financial year.

According to the report, due to the decrease in demand, there is a lot of pressure on companies to cut investment and jobs. Due to this, the government will be able to achieve only 5% growth in this financial year, which is the lowest in the last 11 years. According to the senior tax officer, the tax department has been able to collect only Rs 7.3 lakh crore till January 23. This amount is 5.5% less than the amount collected in January last year.

Tax collection this time will be less than last year- sources

According to the report, after the tax is collected in advance from companies in the first three quarters, officers walk in the last three months assuming a growth of 30–35%. The data for the last three years also shows this. But eight senior tax officials believe that despite many efforts, the tax collection in the financial year will be less than Rs 11.5 lakh crore, which was collected in the 2018-19 financial year. One officer said – Forget the target. This will be the first time we will see a decrease in direct tax collection. He said – this time there will be a 10% decrease in tax collection as compared to the financial year 2019.