Finance Minister Pranab Mukherjee has raised the budgeted tax collection target by Rs 20,000

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crore to Rs 4.50 lakh crore. This has come on the back of 19.47 per cent jump in net direct tax collection between April and December at Rs 2,98,958 crore as compared to Rs 2,50,232 crore during the same period in the last financial year. The amount represents 69.53 per cent of the budgeted target of Rs 4.30 lakh crore.

In the first nine months of the current financial year, corporate tax collection jumped by 22.07 per cent to Rs 2,03,244 lakh crore as against Rs 1,66,503 crore in the same period last fiscal while collections from personal income tax went up by 14.57 per cent at Rs 92,295 crore vis-à-vis Rs 83,178 crore between April and December in 2009-10.

Direct taxes, now the major source of tax revenues to the Centre, have grown at an average annual rate of 24 per cent in last five years and have nearly trebled from Rs 1,32,771 crore in 2004-05 to about 3,78,000 crore in 2009-10. The contribution of direct taxes to the Central tax revenues has grown from 43.79 per cent to 60.5 per cent during the same period.

The Thirteenth Finance Commission (2010-15) has projected direct tax revenue collection at Rs 8,29,668 crore by 2014-15 and direct taxes would contribute 7.62 per cent to GDP.

The IT department released Vision-2020 document and a strategic plan covering the five-year period from 2011 till 2015. A mid-term review of the implementation of the plan will be done in 2013.

According to the vision document, the IT department plans to constitute an expert group for developing a revenue forecasting model as well as an expert group for conducting a study on tax leakages. The two groups are expected to be in place before the end of financial year 2010-11 and would consist of economists, statisticians, social scientists and government agencies.