New Delhi: Finance Minister Arun Jaitley on Monday said direct tax collections for the current financial year were likely to increase by 14-15 percent, enabling the government to improve upon its fiscal deficit target of 3.9 percent.
In his address to the annual conference here of senior officials of the Central Board of Direct Taxes (CBDT), Jaitley praised the income tax department for achieving a 9 percent growth in the last financial year and said: "It goes to the credit of the direct taxes department that even when the economy was recovering from a slowdown last year, when many did not expect tax collections to rise significantly, direct tax collections did rise by more than 9 percent, which brought us very close to the revised targets."
"This year, with increased buoyancy and improved GDP growth rates, we expect a growth of around 14 to 15 percent, and that seems reasonably plausible. It is only thus that the increased expenditure of the government can be met," Jaitley added.
The finance minister told the conference of chief commissioners of income tax that they have a responsibility to recover every rupee that is due to the government.
"You have the responsibility to recover every rupee which is due to the government. A tax is either payable or not payable. If it is not payable, then no attempt has to be made to recover it; but if it is payable, then there is no scope for any collateral consideration as to why it must not be recovered for the government," Jaitley said.
He had, in his first full union budget in February 2015, extended the target deadline for controlling fiscal deficit to three percent, reasoning that insistence on a timetable to contain the deficit would harm growth prospects.
The fiscal deficit targets have been set at 3.9 percent for 2015-16, 3.5 percent for 2016-17, and 3.0 percent for 2017-18.
Jaitley, however, told senior tax officials on Monday that the Modi government would prefer to increase expenditure on social sector schemes instead of improving its fiscal deficit target.