Slowdown in the construction sector, the State government’s liquor policy, and acute shortage of staff have hit income tax collection in the State.
For the first time in recent history, tax collection showed a negative growth, with a mobilisation of Rs.7,309.8 crore, as on March 3, 2015. The corresponding figure up to March 3, 2014 was Rs.7,397.9 crore, highly-placed sources in the Central Board of Direct Taxes told The Hindu on Wednesday.
This is in sharp contrast to the all-India growth of seven per cent, where the income tax collection stood at Rs.5,02,808 crore as on March 3, 2015, while the figure as on March 3, 2014 was Rs.4,69,224 crore. Currently, the tax collection attached to the Kochi Commissionerate shows a loss of 1.2 per cent, while in Mumbai the growth is 9 per cent, Delhi (14 per cent), Bengaluru (17 per cent), Chennai (4.7 per cent), and Pune (7 per cent).
“The income tax collection showed a loss in State complementing with other revenue collection agencies including Central tax and Sales tax,” sources said.
Incidentally the Kozhikode Income Tax Commissionerate has struggled to get a positive growth of 14 per cent. So far, the tax collection stood at Rs 400 crore in 2015 while the revenue was Rs 350 crore in 2014 ( as on March 3).
The department expected to collect revenue between Rs 650 and 700 crore this fiscal. Sources said that the lion’s share of tax collection came from the construction industry and allied sectors.
The shortage of sand and laterite bricks and ban on quarrying seemed to have an adverse impact on sale of cement, steel, and paints.
The revenue collection from the liquor sector, including sale of liquor from bar hotels, could be between 5 and 10 per cent. This means that the quantum of Central funds that would be transferred to the State would be less even as the Modi government accepted the 14{+t}{+h}Finance Commission’s recommendation to increase the State’s share of Central taxes to 42 per cent from 32 per cent. The Income Tax Commissionerates in the State have shortage of staff in the range of 40 to 50 per cent.
- Quantum of Central funds to State will be lesser
Acute staff shortage in IT commissionerate