Demonetization, GST drag down tax collection

RAJKOT: The income tax department in Gujarat may not be able to achieve the target of Rs 55,571 crore collection set by the Central Board of Direct Taxes (CBDT) for the current financial year.

In a recent meeting meeting chaired by CBDT member Neena Kumar in Ahmedabad, it was revealed that the growth rate of income tax collection till December 31, 2018 was nearly Rs 34,570 crore. This means, the department has to recover roughly Rs 21,000 crore in three months till March to meet the target. 

Last year, the income tax collection from Gujarat was Rs 46,800 crore.

All chief commissioners of Gujarat and senior officers in Ahmedabad attended this meeting held in Ahmedabad before few days. It’s learnt that officials cited slow growth due to negative impact of demonetization and slowdown in some of the major sectors in Gujarat as the reason for less collection. However, CBDT member instructed them to take all possible action to achieve the target before March.

Sources privy to the meeting said that most senior officers termed this target is ‘very difficult’ to achieve. The officers told Kumar that in the previous two financial years, the growth rate was high because of demonetization and income tax declaration scheme (IDS). Nearly half of the tax collection in 2016-2017 came after IDS and rest came in 2017-18. Officials emphasized that the growth in some key sectors like pharma and textile remained sluggish because of negative effect of demonetization and migration to Goods and Service Tax (GST) region.

A senior I-T officer told TOI: “CBDT has instructed officers to mount recovery survey and other coercive actions in the next two months. We have also been told to arrest arrest the tax evaders and attach their properties to collect the dues to achieve the revenue target. CBDT has refused to revise the target.”

Parth Ganatara, senior executive of Rajkot Chamber of Commerce and Industry (RCCI) said, “In Saurasthra region, the growth in Morbi’s ceramic sector, Rajkot’s auto components industry, imitation and gold jewellery and Jamnagar’s brass industry has come down to single digit from double digits in last few years. This has reflected in the tax collection.”

“Demonetization badly affected the industry because these sectors are all cash driven. Due to hasty implementation of GST and frequent amendments forced traders to stop trading. The exporters have not get refund of IGST since July 2017 and huge amount is blocked with government,” said Ganatra.

Source- Times of India.

The post Demonetization, GST drag down tax collection appeared first on GST Station.



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