According to revenue secretary Tarun Bajaj, the government will look into how it can achieve parity between the new exemption and the old income tax regime for individuals to encourage more people to switch to the new one.
He claimed revenue estimates were hard but feasible in an interview with Anuradha Shukla and Deepshikha Sikarwar.
Individuals have not received any tax reduction from the government…
What kind of relief could we have provided? Any tax break we provide to the salaried class is not exclusive to them. Everyone has access to it. There was also a lot of debate about what kind of concession we should make, especially given the new exemption-free regime. If we make any concessions under the previous regime, it will jeopardize the entire initiative of an exemption-free regime.
We’ll have to see what we can do to provide parity to encourage individuals to switch to the new regime after a thorough examination of the returns received this year, which will be the first year under the new system. According to 2019-20 returns, 65 percent of income and 16 percent of assesses have transferred to the new corporate tax regime. More people would have moved this year.
Because of the rate drop, excise duty collection has been lowered from Rs 3.94 lakh crore to Rs 3.35 lakh crore, a 15% decrease. When excise duty is removed, the rise is more than 14 percent. More than 1.2-1.3 percent of revenue is buoyant. These are attainable goals.
We’re also working to increase compliance without causing taxpayers any inconvenience, both with direct and indirect taxes. This is also having an effect. We’re informing them that we have information about them, that we’ll contact them, and that they must pay their taxes. As a result, while economic recovery has aided, compliance tightening has also aided.
The GST regime has also been altered, which has aided in the increase of income. The nominal GDP for this year is 17.6%, with real growth of 9-9.2%, resulting in an 8.4% deflator. This is due to excessive inflation based on the Wholesale-Price Index.
Because of the high base, WPI is expected to be lower next year. There’s also a suspicion that the CSO’s prediction of 19.6 was made before the Omicron hit us.
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