22:38 GMT28 February 2021
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    New Delhi (Sputnik): Indian Prime Minister Narendra Modi earlier announced a $266 billion stimulus package to revive the economy, which is bearing the brunt of the pandemic. The nation's banking regulator has indicated that growth in the current financial year (April 2020 - March 2021) will remain in the negative. 

    Despite facing a revenue crunch itself due to the COVID-19 pandemic, the Indian Finance Ministry has said that there is no proposal to impose a calamity cess to higher revenues in the fight against the pandemic. 

    Sources in the ministry said that given the economic scenario amid the pandemic, an additional cess will be an "adversity" in itself.

    A source in the Ministry of Finance said that a proposal like this would prove to be counter-productive, as with the varying degrees of lockdown across the country, sales are already at low volume. Indian PM Narendra Modi imposed the lockdown on 25 March. The national lockdown will continue until 31 May, with some relaxation to industrial, construction, and other service sectors. 

    "Industry is already facing a deep crisis for want of demand and likely labour challenges that might come in near future due to the COVID-19 pandemic. Therefore, tinkering with the taxes or cess would not be a prudent option at all", the source added.

    The Indian government has taken a massive hit to its revenues because of the COVID-19 pandemic, so much so that it has not released the monthly collections of Goods and Services Tax (GST) for the month of April. In March, the Indian government brought in revenue worth $13 billion. 

    A Finance Ministry official told Sputnik, "There has been a very bad impact on GST revenue for the month of April". The official said that April GST revenue is down by at least 66 percent compared with March. 

    Due to the impact of the pandemic the ministry is staring at a revenue gap on both direct as well indirect tax collection for the current financial year. The net tax target of $218.12 billion planned in the budget on 1 Feb is difficult to achieve now, contends the ministry official.

    However, to compensate for losses on account of the pandemic-led slowdown, the Indian government has recently enhanced this year's borrowing from the budgeted $104 billion to $160 billion. 

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

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    Tags:
    calamity, finance, revenue, tax, COVID-19, pandemic, India
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