The numbers are scary, not only the people are in financial distress, but the government’s trove is facing this financial calamity. Let’s talk about the elephant in the room. After this year’s election, the auto sector took a major hit, GDP slowed down, which ultimately affected the tax collection. I agree with the fact that the international recession is somehow responsible for this calamity, but it has been a failure on the part of the Indian government to provide an effective solution or even a relief to the people.
As the people are failing to make taxable income, the collection of Income Tax has been quite low. As a result, the government’s vault is short of money. Arvind Kejriwal, the Chief Minister of Indian capital New Delhi, admitted on a prominent news channel that many states have not been given their share of GST (Goods and service tax), due to the low collection, and it has been quite difficult for them to manage government without any revenue. The GST collections are falling every month, which is concerning. There is a massive shortage of cash flow in the market.
Mr Amit Shah, the Home Minister of India, has said publically in a conference that we are trying our best to manage this situation, and he is hopeful that the economy will grow in the next financial quarter. He did not exactly explain what are the corrective measure taken by the government, but he has verbally assured that the economy will get better.
Both direct and indirect tax-related revenue departments are now working tirelessly to collect due taxes from people so that the government can pay its due share to the states, and manage the central government also. India needs cashflow and investments soon to tackle this economic slowdown, but we hear less and less from the government about corrective measures.