Chidambaram pitched for higher tax-GDP ratio

New Delhi, Sept 3 (ANI): Finance Minister P. Chidambaram on Monday expressed the need to push tax- GDP ratio to 12 percent.

Speaking to media after addressing Chief Commissioners and Directors General of Income Tax, Chidambaram said, "Our aim is to go back to 12 per cent. Even at 12 per cent India will be one of the lowest tax countries as proportion to tax to GDP."

Tax to GDP ratio has come down to 10.1 per cent from 11.9 per cent in 2007-08.

The Finance Minister also assured that the government will ensure a stable tax regime and non-adversarial approach in revenue collection, while exuding confidence to meet direct tax collection target for the current fiscal.

"We will ensure there is a stable tax regime, there is stable tax laws and everybody adopts a non-adversarial approach to tax collection. I have asked chief commissioners to adopt non-adversarial approach to tax collection. I have told the CCITs to repeat this message to all commissioners, all assistant commissioners and deputy commissioners and ITOs," he said.

"It is our intention to achieve the Rs. 5,70,257 crore direct tax collection target for the current fiscal. We will be able to achieve the target," he added.

Asking assesses to pay advance taxes by due date, Chidambaram said, "paying taxes is a mark of civilization. If I pay more taxes, I should be happier and more proud. I am making more money and I am paying more taxes."

The corporates would be paying the second installment of advance tax and individuals their first installment of advance tax by September 15.

Asked how he intends to raise tax collection, Chidambaram said, "Both by increasing the base, by making people file returns, encouraging them to file returns and quicken the process of assessment so that the tax can be collected."

The corporate tax rate is 30 percent, he said, adding, but the effective tax rate for corporates is 24 per cent.

There are several sectors that are well below the average. In such cases, the average ranges from 10-22 per cent, he said. (ANI)