There has been a tremendous jump in the government’s earnings and now the Finance Ministry feels that the work is on track to make India a five trillion dollar economy by 2025. But can it also be expected that after the increase in earnings, the government will do something to give relief to the middle class troubled by inflation? It is natural to raise this question after a significant increase in the collection of income tax, corporate tax, customs duty and GST. But the answer given by the expressions of the Finance Ministry officials and the hints hidden in their statements does not seem to give much hope.
In the figures released last week, the government itself has told that there is a huge income from tax. The government expected that in the last financial year 2021-22, it would earn Rs 22.17 lakh crore by way of tax. But now the news has come, this earning has crossed Rs 27 lakh crore. In this income, the share of corporate tax, that is, income tax on the earnings of companies, is Rs 8.6 lakh crore. 56 percent more than last year. On the other hand, the share of personal income tax has also jumped by 43 per cent to Rs 7.48 lakh crore. In this way, the revised estimate of direct tax earnings has reached Rs 14.1 lakh crore, much higher than the revised estimate of Rs 12.5 lakh crore.
The increase in the collection of indirect taxes is a little less, but here too there has been an increase of 20 per cent. On an average, Rs 1.23 lakh crore has come into the account of GST every month, as compared to Rs 1.01 lakh crore and Rs 94,734 crore in the previous two years. There has been a jump of 48 per cent in import duty, while there is a slight decline in excise collection.
With this jump in tax collection, India’s tax-GDP ratio has also increased. Now 11.7 percent of GDP is coming from tax. In this, the share of direct tax is 6.1 percent and that of indirect tax or GST, customs and excise is 5.6 percent. The second meaning of this is that now there has been an improvement in the tendency to pay taxes in the ratio of earnings and business in the economy. For this, the government is praising the reforms in the tax system, pre-filled tax return forms and systems like AIS, due to which it has become very difficult to hide or evade tax. The Finance Ministry also says that the confidence of taxpayers has increased due to speedy settlement of income tax returns and early refund issuance. The ministry said that Rs 2.24 lakh crore has been returned to the taxpayers.
After taking this hand and giving this example, the question also arises that the refund of income tax had to be given, but the recovery is going on in the name of excise on petrol and diesel and due to this the inflation that the public has to face. What is the government doing to give relief to him? As soon as this question arises, the government and the advocates of the government start looking side by side. When the Union Revenue Secretary Tarun Bajaj showed the figures of spurt in tax collection and said that the increase in recovery was the proof of the economy coming back on track, after a while he also told that despite such tremendous good news, now is the time to rejoice. has not come. They say that after June, a better estimate can be made, because then an installment of advance tax would have arrived. At the same time, there is a concern of the government that while the collection of direct taxes like income tax and corporate tax is improving, but the collection of indirect taxes does not increase at the same rate. Sometimes one or two things get manipulated in such a way that the whole math gets messed up. The biggest example of this is petrol and diesel. In November last year, before Diwali, the government had cut the excise duty of petrol and diesel by five and ten rupees, and within a month, the government had to cut their import duty by five percent to curb the inflation of edible oil. Had to do
Only after that the elections of five states were also to be held and in this cycle the process of increasing the prices of petrol and diesel was also stopped for more than four months. Although, the price of both the things is decided by the market now, but the four big petroleum companies are under the control of the Government of India, so it is not difficult to guess that when and by whom the decision to increase or decrease the price is taken? There is also evidence that from a few days after the end of the election, the price started increasing at the rate of 80 paise a day and kept increasing by about ten rupees a liter. This shows that the government is fully aware that the issue of inflation can create trouble for it any day.
The government has tried and seen a way to reduce the price of petrol and diesel or reduce inflation. But this weapon cannot work again and again, because the burden of cutting excise has to be borne by the Central as well as the State Governments and the financial condition of most of the states is already very bad. Secondly, this reduction in earnings will also increase the pressure on governments to reduce their spending. And at this time, not only the state, but the central government is also spending a lot on such schemes, which are called public welfare. Now the question is, if relief is to be given on the inflation front, then in which of these accounts will the expenditure be deducted? Elections are yet to come in Gujarat and Himachal and after that the country will be busy preparing for the Lok Sabha elections. So, where can I find the answer to this question? I can only say this – Ghalib is not unbearable, there is something for which there is greatness.
(These are the author’s own views)