E-Governance To Help Combat Slowdown Impact On Tax Revenue
Rakesh Lohumi / Shimla
The switchover to e-governance and the imposition of entry tax will to a large extent help mitigate the impact of economic slowdown on the tax revenue during the current financial year.
The hill state is not likely to maintain the all-time high growth of 34 per cent in the tax revenue achieved during 2010-11, but the Excise and Taxation Department will still achieve the target of Rs 3,574 crore set by the government for the current year. The trend for the first three quarters indicates a slowdown in the VAT growth with the overall tax collection reaching Rs 2,650 crore as compared to Rs 2,100 crore last year, an increase of 24 per cent. This includes an amount of Rs 120 crore collected by way of entry tax on industrial inputs. The impact of slowdown has been confined to Solan, Una and Bilaspur districts where the industry is concentrated.
Last year VAT, excise duty and luxury tax amounted to Rs 3,045 crore, up from the previous year’s Rs 2,274 crore. The normal average growth has been around 22 per cent and the previous highest growth was 26 per cent after VAT was introduced in 2005. Last year the entry tax brought an additional revenue of about Rs 80 crore and this year the amount is likely to cross Rs 200 crore. Similarly, the revenue from the sale of liquor will go up from last year’s Rs 580 crore to Rs 710 crore. However, there has been hardly a 15 per cent growth in the luxury tax so far and it is not likely to improve.
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