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'Service tax collection to swell over Rs 10,000 cr'
August 06, 2003 16:38 IST
With the scope of expanding excise and customs duties getting increasingly limited, the government would turn to service tax for widening the tax base, mop up from which is expected to fetch over Rs 10,000 crore (Rs 100 billion) by 2005, more than doubling the current annual collection of Rs 4,125 crore (Rs 41.25 billion).
"Even with the existing conditions, I am sure we can generate more than Rs 10,000 crore," Central Board of Excise and Customs member S K Misra said at an interactive session organised by the Associated Chambers of Commerce and Industry of India and the PHD Chamber of Commerce and Industry in New Delhi on Wednesday.
He was responding to PHDCCI President P K Jain's expectation that the tax collection could reach Rs 10,000 crore by 2005 and Rs 20,000 crore (Rs 200 billion) by 2010.
Though service tax mop up was only Rs 4,125 crore last year, below the target of Rs 6,000 crore (Rs 60 billion), he said this year's budget estimate had been kept high at Rs 8,000 crore (Rs 80 billion) and was hopeful of a better performance because of the widened tax base, taxes on new areas and increased rate of taxation.
Citing that there were only 250,000 assesses for service tax, Misra said it was imperative to enhance the registration and tax payment.
"We have envisaged service tax on voluntary basis and is not mandatory," he added.