Corporate advance tax collections in Mumbai give warning signals, indicating the tough situation ahead, following the global slowdown. The tax collection in Mumbai failed to meet its revenue target of 1.57 lakh crore for FY09 (April 2008-March 2009). Mumbai corporate tax collection contributes around 35-40% to the country's tax kitty. Tax collection has increased just 20% in the current financial year up to December, as compared to 60% in the same period last year.

Direct tax growth declined to 22.2 per cent, following the global financial crisis. Government collected Rs 1,77,251 crore as direct taxes between April to November this fiscal. The collection was Rs 1,45,053 crore till November last year. Low economic activities impacted the state revenue significantly as companies are facing low demand amid tight monetary policy and global slow demand. Tax growth witnessed 45% increase earlier this year while 29.5% growth a month ago.

The effects of the economic slow down due to the global financial crisis, has resulted in a five per cent fall in excise and customs collection during October. The decline in indirect tax collection comes at a time when the government is finding it hard to mobilize resources, while expenditure on subsidies and other welfare measures is going up.

The excise collection, decreased by 8.7 per cent to Rs 18,664 crore as against Rs 19,646 crore during the same period a year ago, while customs duty collections declined by 0.9 per cent to Rs 9,265 crore from Rs 9,353 crore in October 2007.

Net direct tax collections rate for seven months of this financial year registering a growth of 29.52 per cent. It stood at Rs166,905 crore up to October 2008 as compared to Rs128,864 crore for the same period of last year. The country remained successful to increase tax collection, despite global slowdown.

Corporate tax increased to 33.49 per cent and stood at Rs105,174 crore as against Rs78,785 crore. Income tax growth rate too increased registering a growth of 23.14 per cent. Fringe benefit tax (FBT) increased by 47 per cent and dividend distribution tax grew above 48 per cent which indicates sound financial health of the  country despite global financial crisis.

Disappointed on the hike in VAT rates, members of Indian Industries Association (IIA) held a demonstration in which over sixty of them were arrested by the police on Monday. However they were set free after three hours.

Annoyed with the State’s decision and henceforth demand to have VAT at par with the other states, the industrialists had earlier proposed to have a car rally which was supposed to end at Patel Park after which they wanted to have a dharna but the administration did not give its approval for the same. On Monday about 250 cars were parked at Moti Mahal but on the car rally’s disapproval, the industrialists resorted to march through the market. On this the police got enraged and arrested them.

The net tax growth by center government registered a growth of 25.51 percent in the month of September. Rs 62,788 crore were collected as compared to Rs 50,025 crore in the corresponding period last year. The growth is witnessed due to starting of an advance tax installment during the month of September.