Even as the government takes a hit on revenue due to the recent excise and custom duty cuts on fuel and certain commodities, going by the preliminary indicators, revenue receipts in FY’2022-23 may exceed the budget estimates on strong Goods and services tax (GST) collection for the year according to a top finance ministry official
The collections have already started trickling in. “So far it is good. On the indirect taxes front, there has been a sacrifice in excise and customs duty that has happened” said revenue secretary Tarun Bajaj, revenue secretary. ” But on the GST front we have been doing pretty well. GST will take a lot of load of what sacrifice we have done on excise and customs duty front”.
The government expects the revival in the economic activity to boost demand for goods and services that were hit during the pandemic. “If we look at the PMI services, it is showing a good growth. As compared to last year, there will be growth in some contact intensive sectors. We may see sector like tourism and hospitality back to pre-pandemic levels”.
The government is also seeing a broad-basing of GST net. “I feel optimistic and I think this year again we will be able to do far better than we thought initially when we were making the budget,” the Revenue Secretary Revenue Secretary Shri Tarun Bajaj at the event in Mumbai.
With the Tax to GDP ratio reckoned to be over 10 per cent of GDP, the government is also working towards bringing down the share of indirect taxes in the total tax revenue as it hurts the poor most.
In FY’22, the revenue receipts were Rs 5 lakh crore more than the budget estimate for FY’22” Heavy lifting was done by the department on the fiscal side to ensure requisite expenditure is made by the government” Bajaj said.