Various measures taken by Government contribute to increase in tax collection
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Recently, the Ministry of Finance published various measures taken by the Government which contribute to the increase in Tax collections.
These figures reflect the recovery of the economy post-COVID-19 and the Government highlight better compliances due to various measures that have increased tax collections. The Government also submits a few statistics as stated below:
Gross Tax Revenue in FY 2020-21 was Rs 20,27,104 crores while in FY2021-22, the Gross Tax Revenue is Rs. 27,08,291 crores.
GST collections also show improvement- In the year 2021-22 manufacturing sector accounts for Rs 4,88,215 crores while the service sector accounts for Rs. 4,38,921 crores.
Furthermore, Direct tax collection for both these sectors in FY 2021-22 is Rs.1,91,908.99 crores (Manufacturing Sector), and Rs. 3,48,807.70 (Service Sector)
The Finance Minister stated that among other steps, the following has been done towards becoming a five trillion dollar economy and beyond: –
The Government increased its CAPEX budget by about 35 percent in 2021-22 and again by another 35 percent in 2022-23. In 2022-23, the budget allocation for CAPEX after including the allocation to the States is Rs. 10.68 lakh crore, which is 4.1 percent of GDP.
The drive towards privatization as announced in Budget 2021- 22 is now complemented by PM Gatishakti Scheme announced in the 2022-23 Budget, to ensure inter-ministerial coordination in infrastructure building for economic transformation.
The Production Linked Incentive Scheme, which was initially announced as a major component of the Atmanirbhar Bharat Mission, has been expanded to cover 14 sectors, which together with the National Infrastructure Pipeline of Projects, will boost investment and growth in the economy.
The Government has recapitalized banks, merged them, and strengthened their balance sheets so that bank lending can grow faster.
The Minister stated that the measures taken in the past will also help the country become a five trillion dollar economy. These include, the Minister stated, the introduction of Goods and Services Tax (GST), Insolvency and Bankruptcy Code (IBC), reduction in Corporate Tax Rate, Rationalization of Labour Laws, among others, which have also improved Ease of Doing Business.
Taxation Insight
(Source: PIB)
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