InvestorQ : How is the current COVID-19 shutdown like to impact the tax collections of the government this year? Will it get affected in big way?
Lavanya Subramanian made post

How is the current COVID-19 shutdown like to impact the tax collections of the government this year? Will it get affected in big way?

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ishika Banerjee answered.
1 year ago
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In fact, India’s direct tax collection for 2019-20 is likely to see a huge shortfall of Rs.150,000 crore as per recent estimates. This is the shortfall on the revised estimates of tax collections which is already a reduced number. This could be the worst tax collection performance in over 20 years. Direct collections may end up at Rs.10.2 trillion against the revised target of Rs.11.7 trillion for the current fiscal. Even the Vivad se Vishwas scheme has not had a single response so far. Compared to the original target of Rs.13.5 trillion, this is a huge shortfall. Of course, the cut in corporate tax rates and income tax exemptions also added to this shortfall. This shortfall cannot purely be blamed on the Coronavirus because this shortfall was visible even in the previous months. It remains to be seen how much this will impact the fiscal deficit, which has been already widened by 50 basis points to 3.8% in the latest budget.

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