Worried over the shortfall in the overall direct tax collection kitty, the government has asked banks, both public and private, to not delay remitting of TDS funds of the current month into state coffers and do the same within the current financial year ending in March.
The Income Tax department and its apex policy making body, the Central Board of Direct Taxes (CBDT), are wary that the growth registered this time under the Tax Deducted at Source (TDS) category is less than half as compared to the corresponding period last fiscal.
According to official data updated till March first week, TDS collections stood at 7.49 per cent as against 16.69 per cent in the same period last year.
“The situation of tax collection under TDS category remains challenging even at the end of March now. There is a big slowdown in construction, manufacturing and other physical work projects in the country which is taking a toll on TDS and Tax Collection at Source (TCS) categories.
Meeting the direct taxes revenue collection target this time is looking quite challenging, perhaps it may not be met even and miss by a whisker,” a senior I-T official said.
The official said keeping in mind this situation, the Department of Financial Services (DFS) under the Finance Ministry has asked all public sector and private banks to “ensure that tax deducted during the month of March, 2015 is remitted to the government account in March itself”.
“The CMDs, MDs of public banks and the Indian Banks’ Association have been asked for compliance in this regard by the DFS.
Also, the Revenue Secretary has written to Chief Secretaries of all states, requesting them to suitably direct the officials concerned to ensure proper tax collection at sources (TCS) on lease/license/contract for mining and quarrying and for parking lot and toll plazas,” the officer said, quoting official communications made in this regard by the Finance Ministry and the CBDT recently.