I-T misses city target
The after-effects of the economic slowdown continue to haunt the income tax (I-T) department, which has missed its target annual by Rs 12,000 crore in Mumbai.mumbai Updated: Apr 07, 2010 01:01 IST
The after-effects of the economic slowdown continue to haunt the income tax (I-T) department, which has missed its target annual by Rs 12,000 crore in Mumbai.
Salary cuts and job losses during the crisis period are the major factors contributing to the shortfall.
The I-T department, Mumbai circle, could collect Rs 1.28 lakh crore for the recently concluded financial year of 2009-2010. The target for the city was Rs 1.4 lakh crore.
I-T officials said that Rs 10,000 crore less collected in the form of tax deducted at source (TDS) was the main reason for the overall shortfall. Of the total target, the department was expecting to collect about Rs 64,000 crore through TDS.
A large portion of TDS comes from the salaried class. “Companies axing salaries of their staff and many others undertaking job retrenchment during the slowdown, lead to a fall in TDS collection,” said a senior I-T official requesting anonymity as he is not authorized to speak to the media.
Moreover, the growth in tax collection over last year in Mumbai was only 9.4 per cent. Last year Mumbai contributed Rs 1.17 lakh crore. Officials said the growth rate had fallen considerably when compared with that during the boom when it averaged more than 25 per cent.
The department expects collection for 2010-2011 to be similar to the past year with the tax rates slashed drastically in the budget.
Officials said they were preparing to increase the number of raids and surveys to meet the new target that would be announced in two months. “If the government has become liberal by reducing the tax rates, it expects better (tax) compliance from people,” the official said adding that those still evading tax would be dealt with strictly.
Chief Commissioner of Income Tax, Mumbai, R. K. Singh could not be reached for comment as his office said he was busy.