Indirect tax collections grew by 5.8 percent to Rs 2.42 lakh crore during April-September period of current fiscal as compared to Rs 2.29 lakh crore during the same period of previous financial year. Indirect taxes include customs duty, central excise duty and service tax. The growth at 5.8 percent is far lower than 25 percent annual increase envisaged in Budget 2014-15 and is mainly impacted by decline in excise duty collections, indicating slump in manufacturing activity.
Central excise tax collection declined by 0.6 percent y-o-y to Rs 75,021 crore during the first six months of current fiscal. However, customs collections rose 5.5 percent to over Rs. 89,324 crore during April-September FY15 period against Rs 84,643 crore in the same period a year ago. Service tax collections grew by 13.1 percent to Rs 77,466 crore during the reported period. Over the past few months, services tax collections have been showing firm growth trend as the government had introduced the concept of negative list of taxation to widen the service tax base.
During September, indirect tax collections grew by 12.3 percent to Rs 48,012 crore. Excise duty collections in September contracted by 0.4 per cent to Rs. 14,288 crore, whereas custom duty collections grew by 32.8 percent to Rs 18,116 crore during the month. Service tax collections in September rose by 5.8 per cent to Rs. 15,608 crore against Rs 14,755 crore in the same month of last fiscal.
Tax collection is the major source of revenue for the government. The Budget aims to mobilise Rs 6.23 lakh crore in 2014-15, which requires a growth rate of 25 per cent over 2013-14. The government has estimated to garner Rs 13.64 lakh crore from both direct and indirect tax collections during the current fiscal.