India Wont Reach Tax Target
October 6, 2015 Taxation in India
NEW DELHI – Economic growth in India will reach 7.5 percent this year, however, the government will not reach its own tax collection goals.
On October 5th the Ministry of Finance of India announced that the government will not collect enough tax revenues to meet its own budgetary goals for the year.
Tax revenues for the year are expected to reach INR 14 trillion, while the government had planned to see revenues hit INR 14.5 trillion.
The shortfall in revenue collections has been attributed directly to lower-than-expected collections of direct taxes over the course of the year, with the cumulative total for the year forecast to be up to 7 percent below targeted.
However, despite the fall in direct tax collections, the collection indirect taxes saw a significant rise, increasing by 35.5 percent by the end of 2015.
The Ministry also announced that based on current projections, the total economic growth in India for the 2015 year will reach approximately 7.5 percent.
Despite the drop in taxes, the Ministry noted that the improving fundamental economic conditions in the country will grant the government more room to make economic decisions and weather the brunt of any unforeseen economic shocks.
Photo By: Barney Moss