This is how govt will have additional Rs 15,000 crore in FY18
In February, Finance Minister Arun Jaitley while presenting the Union Budget of FY17-18, had revised the estimate of tax collection for FY17 to Rs 16.97 lakh crore.
The government will begin FY18 with an additional amount of Rs 15,000 crore.
This is how.
The taxes from non petroleum contributed a significant 22.6% to the union excise growth of 33.9% during FY17. This has helped the provisional figures of tax collection in financial year 2017 increase by 18% to Rs 17.10 lakh crore.
The amount is highest in last six years.
According to SBI Ecoflash report, in FY16, the petroleum contribution in union excise was higher, as Government has increased excise tax a number of times to get the benefits of falling crude oil prices.
However, this has since then declined in FY17, reflecting that the buoyancy in excise tax collections is indeed attributed to growth of additional components. This is contrary to market perception that oil is the primary lubricator of this jump in excise, the report said.
In February, Finance Minister Arun Jaitley while presenting the Union Budget of FY17-18, had revised the estimate of tax collection for FY17 to Rs 16.97 lakh crore from last year's Budget estitmate (BE) of Rs 16.25 lakh crore.
What led to rise of Rs 15,000 crore tax collection?
Dr. Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India, in a report titled 'Rs 15,000 Crore Fiscal Bonanza For FY18' said, "Based on the petrol and diesel consumption trends in Apr’16-Feb’17, we estimate that excise duty collected from petroleum products may have registered a growth of 12%.
If this is so, the recent spurt in excise duty collections is also due to some other components other than petro products and possibly some other reasons other than petroleum products (the growth rate of such is well in excess of 50%), Ghosh added.
Thus, the tax numbers provides leeway for FY18. This is because the government has already exceeded the tax collection figures or Rs 16.97 lakh crore. So, if disinvestment receipts are also added, the government will begin the FY18 with an additional revenue of Rs 15,000 crore.