New Delhi The amount of revenue foregone by the government due to tax exemptions more than doubled from Rs 65,587 crore in 2006- 07 to Rs 1,38,921 crore in 2010- 2011, a CAG report said today.
” We found that the revenue foregone on
account of tax exemption has increased by 111.8 per cent from Rs 65,587 crore in 2006- 07 to Rs 1,38,921 crore in 2010- 2011,” the report for the year ended March 2011 by the Comptroller and Auditor General ( CAG) said.
The main objective of any tax system is to raise revenues necessary to fund government expenditure, it said adding the amount of revenue raised is determined to a large extent by tax base and tax rates.
” The revenue forgone ( on account of tax exemption) in respect of corporate taxpayers increased by 73.6 per cent as compared to 226.6 per cent in respect of non- corporate taxpayers during 2006- 07 to 2010- 11,” the report tabled in Parliament said. During last five years, it said, direct tax collections have increased from Rs 2,30,181 crore in 2006- 07 to Rs 4,46,934 crore in 2010- 11, at an average annual rate of growth of 23.6 per cent.
In case of corporate assessees, net collection increased from 1,44,318 crore in 2006- 07 to Rs 2,98,687 crore in 2010- 11, at an average annual growth rate of 26.7 per cent, it said.
The report said in the case of non- corporate assessees, net collection increased by 21.6 per cent from Rs 75,079 crore to 1,40,042 crore during the period under review. The report also pointed out that there was a marginal growth in taxpayers during the five- year period.
” We observed that the assessee base grew over the last five years from 313.0 lakh taxpayers in 2006- 07 to 335.8 lakh taxpayers in 2010- 11, registering an increase of 7.3 per cent,” it said. — PTI
