30.5% growth in service tax is achievable: CBEC Chairman

April 10, 2012 8:26 am

In an attempt to reduce fiscal deficit, the government has targeted the revenue through service tax of Rs.1,24,000 crore during FY 2013; a huge 30.5 per cent increase vis-à-vis the budgeted FY 2012 estimates. The Central Board of Excise and Customs (CBEC) is quite optimistic of meeting the same target, despite indications to the contrary due to faltering industrial activity and the resultant general gloomy corporate sentiment.
The CBEC is also hopeful about achieving the indirect tax target. “We have achieved 14.6 per cent growth till February, which is 89 per cent of the total target,” CBEC Chairman S K Goel told the media persons during a post budget interaction organised by FICCI on 24th March in Mumbai. Several senior officials from the Finance Ministry interacted with industry representatives and took note of their concerns. The interactive session was chaired by Ramu Deora, Chairman, Foreign Trade & Trade Facilitation Committee, FICCI.
While addressing trade and industry representatives, Mr. Goel said, “Union Budget 2012-13 was prepared with a twofold objective of reducing the fiscal deficit and widening the tax base. The government has budgeted a fiscal deficit target of 5.1 per cent of GDP in FY 2013 as against an estimated 5.9 per cent of GDP in FY 2012. The government has taken several measures to augment indirect taxes. On the services tax front, the tax base has been increased through the introduction of the negative list”. He adds, “GST network is expected to roll out by August 2012”.
Commenting on the different positive initiatives taken into considerations while drafting the budget 2012, Mr. Deora said, “FICCI’s suggestion of negating the cascading impact of Dividend Distribution Tax has been accepted. In relation to infrastructure FICCI strongly supports the Governments’ proposal of doubling the amount for issuance of tax-free bonds, extension of viability gap funding for more sectors, allowing external commercial borrowing for new areas and new purposes. Another welcome measure is the extension of section 80-IA benefit for power sector”. However, he had urged that a three/six month’s transition period should be provided for a smooth switchover to the GST while simultaneously protecting the interest of the exporters.