Govt may rework indirect tax maths mid-way after

 GST entry Perhaps in a first, the government may have to recalibrate its budgetary tax collection estimate half-way after the goods and services tax (GST) comes into effect from July. Govt may rework indirect tax maths mid-way after GST entry Perhaps in a first, the government may have to recalibrate its budgetary tax collection estimate half-way after the goods and services tax (GST) comes into effect from July. In Budget 2017-18, Finance Minister Arun Jaitley used the traditional tool of setting a modest growth to the expected revenue collection in the current fiscal for indirect tax projections of the next financial year. By that yardstick, 2017-18 will be a different year compared with the past. Mid-way, GST will kick in by subsuming all central indirect taxes such as central excise and service taxes as also state levies like VAT into one.

 So, we are being conservative in estimate," Revenue Secretary Hasmukh Adhia told PTI here. The GST revenue collections can be arrived at once the all-powerful GST Council, headed by Jaitley, fixes tax rate for every goods and service. Also, Parliament has to pass two supporting GST legislations and each of the state has to approve one legislation. Adhia said the heads of excise and service tax in the Budget estimates can be removed once GST comes in. "We can change it (budgetary heads). We can remove the head of excise and service tax and bring in GST. That can be done administratively even from July 1. The government can reappropriate between two Budget heads," he said. Indirect taxes have three major components -- Customs, central excise and service tax. 

While projections of Customs revenue will continue to be same through 2017-18, those for excise and service tax may have to be reworked as the same is to be subsumed under GST. For 2017-18, Jaitley has projected excise collections to rise by 5 percent to Rs 4.06 lakh crore over revised estimate of Rs 3.87 lakh crore for the current year. This growth is primarily due to 6.3 percent growth in collections from basic excise duty on petrol and diesel. Service tax receipts are projected to rise by 11 percent to Rs 2.75 lakh crore. Customs revenue is projected to climb 13 percent to Rs 2.4 lakh crore. In total, the government estimates to collect nearly Rs 9.27 lakh crore from indirect taxes next fiscal, up 9 percent over 2016-17

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