Tax refunds may be slowed down: govt wants that money
25 May 2011
Showing utter callousness for the fate of the average taxpayer, the Central Board of Direct Taxes is likely to deliberately go slow on paying income tax refunds in order to prop up the government's sagging finances.
Revenue secretary Sunil Mitra on Tuesday told the annual conference of chief commissioners and director-generals of income tax that they should slow down the pace of refunds, as the government is facing a cash crunch on account of hefty outflows that were not planned for this part of the year.
Earlier, bringing relief to taxpayers, the CBDT had decided to speed up refunds. As a result, it provided tax refunds of Rs73,000 crore in 2010-11 and Rs23,000 crore in the first month of the current fiscal.
This has not pleased finance minister Pranab Mukherjee's ministry, which fears a drop in revenue collection because of rising inflation and moderation in growth.
"I would like to sound a note of caution in respect of targets for direct taxes that have been set for this year at Rs5.32 lakh crore," Mitra told the conference.
''The board's proposal to clear all pending refunds of the assessment years 2010-11 and 2011-12 will require to be moderated in keeping with the actual performance in direct tax collections,'' Mitra said in widely reported comments.
