We’ve cut rates but you mustn’t miss targets, Modi tells taxmen
India’s Finance Ministry has delivered a challenge to its revenue collectors: meet tax targets despite $20 billion of corporate tax cuts.
Through a video conference on Dec. 16, officials were exhorted to meet the direct tax mop-up target of Rs 13.4 lakh crore ($187 billion), a go nment official told reporters. Collection in the eight months to November grew at 5% from a year earlier, against the desired 17%.
The missive shows Prime Minister Narendra Modi’s urgent need to buoy public finances in a slowing economy where April-November tax collections were half the amount budgeted. Authorities withheld some payments to states and have capped ministries’ expenditure as the fiscal deficit ballooned beyond target.
The go nment’s efforts to maintain its deficit goal goes against advice from some quarters, including central bank Governor Shaktikanta Das, who urged more spending to spur economic growth.
It’s uncertain though how much room Modi’s administration has to boost expenditure, given that it may already be borrowing as much as 540 billion rupees through state-run companies, a figure that isn’t reflected on the federal balance sheet. Uncertainty about public finances pushed up sovereign yields in November and December, compelling Das to announce unconventional policies to keep costs in check.
“This is not a time to conceal the fiscal deficit by off-budget borrowing or deferring payments,” said Indira Rajaraman, an economist and a former member of the Reserve Bank of India’s board. “If they were to stick to the target, that would be catastrophic because there is so much pump priming that is needed right now.”
India’s gross domestic product grew 4.5% in the quarter ended September, the slowest pace in more than six years as both consumption and investments cooled in Asia’s third-largest economy. Only go nment spending supported the expansion, piling pressure on Modi to keep stimulating.
S&P Global Ratings warned in December it may downgrade India’s sovereign ratings if economic growth doesn’t recover.
Government support seems to be waning now, with ministries asked to cap spending in the final quarter of the financial year at 25% of the amount budgeted rather than 33% allowed earlier. This new rule will hamstring sectors including agriculture, aviation and coal, where not even half of annual targets have been disbursed.
Finance Minister Nirmala Sitharaman has refused to comment on the deficit goal before an official presentation due Feb. 1.
A deviation from target, if any, “will need to be balanced with a credible consolidation plan further-out,” said Radhika Rao, an economist at DBS Group Holdings Ltd. in Singapore.
译文来源：三泰虎 http://www.santaihu.com/49138.html 译者：Joyceliu
95% of the Indians are cheating on taxes. We should catch all these cheaters and put in Jail. Money is better at the hands of politicians and bureaucrats than at the hands of people. People should give money to the go nment, then go nment will decide what is good for people and do something with the money they have. Jai Hind. Jai Modi.
Why? To build a temple that can be seen from all over the world? Or for Modi to make multiple trips to US and other foreign countries?
As head of the State, it is his duty to misuse the tax payers' money.
Everything is OK, but the message you are trying to convey is missing.
Dr S Sundaramoorthy
The two charts tell their own tale. Lesser ability to generate income vis a vis joblessness is the key concern. Infusing money inlakhs of crores into real estate in my opinion is not going to help overcome this situation and in fact may further widen the gap because it is a one time activity-not a perpetual growth like for example a produce of consumables.
Worst decision,India could develop infrastructures or could buy 20 N. Subs for Navy or could build many more hospitals in the rural areas.
What's with the headline? So meeting a target is a bad thing? If you meet your goal in life it is tax terrorism? Plugging evasion is tax terrorism? Lol.
Shocked to know the precarious position.
Very difficult to meet ambitious target
D P Gangal
Tax collection will increase substantially just by stopping the leakages
Hope and wish, tax officials keep to the law, and avoid misinterpreting laws and raise wrong demands on taxpayers, eg. Tax terrorism.
Anarchy's Coming !
This can be solved by increasing the income tax to 60 percentage. People should be willing to share their wealth when the economy is down. Show some love for your country.
You help the Corporates and now you will let the Taxmen hound the Common citizens.
without increased consumption and exponential profits how you can achive same tax target set before rate cuts. on the contarary there will hue and cry all over India.
teaching economics to modi -BJP is like teaching to a stone.They are living in their own world which is guided by RSS ideology and USA-Right wingers with some mix of indira gandhi socialism.The best thing you can do is keep quiet and enjoy the show because it is gonna end before 2020
I hope you realise that the common man is the fall guy.
Dear editor, please have your breakfast at home instead of eating the comments of the readers.
India fast moving towards...........
private sector taxpayers are slaves to the go nment of India. They cannot retire until age 75, even their savings are taxed and FDs give back only 6%.
Start tax terrorism.
Tax to be paid, but govt not giving anything back to tax payers. How the ordinary private employees live after retirement? They do not have pension or any other govt support other than bank 6% interest on deposit. How daily wage laborers live and how farmers struggle are key areas to look into.
Scam after scam, any results, where is money from? On other hand, tax payers pay for their food, stay and security for so long !!!!!
Hari Krishna Johri
BJP became the richest party just before demonetization. Adanis & Ambanis are becoming rich by leaps & bounds under the able guidance of Feku ji. He talks about Made in India but uses BMW made in Germany ?
So a grand temple is in order, don't worry about malnutrition, lack of education and jobs.
The modi govt looted far more money than congress and we are in strict recession from 2016 onwards.Kick this illiterate guy out and save nation.
I am forced to call you anti national.
Bathmavathi Hari Ram
MALAYSIA SINGAPORE CIVIL SERVANTS MEDICAL ADMISSION IN GOVERNMENT HOSPITAL FREE ADMIT IN 2ND CLASS OR 1ST CLASS NO PRIVATE HOSPITAL,BUT THE HOSPITAL ARE VERY CLEAN AND ALL IN ASPECT,
Let me say this again-indian economy has already crashed as modi worked very hard to shut down indian factories and import from china.He copied UK-EU-USA model of hating manufacturing and loving imports.INdian currency has zilch value in international finance and we are near bankruptcy.Only IT is keeping us alive.
Again anti national.
Yes, I sincerely wish that this comment could be an alarm/alert to the blind sleeping bhakts.
This is a 3rd grader, no intelligence, empty brain and no leadership.
If the go nment confiscates the illegally gotten wealth assets and such things by the Congress party people, that will be enough to run the country for 10 years or more.
What's next, as there is nothing more to confiscate, other than your party bigwigs.
what about adanis-ambanis and modi's own funds?BJP is now richest political party in history of world.It is richer than mughal emperors
Good one. Love it.
Ha Ha already enough headache with domestic consumption now unrest of Middle East will drag more due to fuel cost rising. Corporate tax reduction benefited the owners for curtail their loss and keep quite. They are not going to do anything with that money to increase domestic consumption.
Finance companies are not reducing rates for existing users ....no use of interest reduction to existing loan holders