05:12.2022: Indirect tax receipts to exceed budget estimate by Rs 50,000 crore

The government is banking on extra tax revenues to fund additional subsidy expenditures to the tune of about Rs 2.8 trillion over the budgeted level.

The Centre’s indirect tax revenues – before devolution to states– may exceed the budget estimate (BE) for the current fiscal by around Rs 50,000 crore, as higher goods and services tax (GST) revenues will more than offset a shortfall in excise revenues.

While Central GST collections could exceed the budget target for FY23 by about Rs 1 trillion, excise duty collections may fall short of the Budget estimate (BE) by Rs 40,000-50,000 crore.

The indirect tax receipts in April-October were Rs 7.25 trillion, 55% of the FY23 target.

The implementation of the budget announcement to levy additional basic excise duty at the rate of Rs 2 per litre on the sale of unblended motor spirit from November 1 will also aid tax collections.

The Centre may garner about Rs 30,000-40,000 crore from windfall taxes on petroleum products. On July 1, it imposed special additional excise duty on crude and export taxes on petrol, diesel and ATF. The tax on petrol was removed subsequently. The levies have since been revised on a fortnightly basis, depending on crude prices and the refining spreads.

The Centre’s excise duty receipts are budgeted to be Rs 3.35 trillion for FY23 while CGST estimated to be Rs 6.6 trillion. The Central Board of Indirect Taxes and Customs (CBIC) has instructed filed formations to augment revenues by accelerating the issuance of final orders on tax payment mismatches, taking steps to resolve disputes and faster clearance of goods by customs.


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