If LIC IPO goes well, the FY22 divestment target will be achieved: Revenue Secretary Tarun Bajaj

Revenue Secretary Tarun Bajaj

Revenue Secretary Tarun Bajaj said on February 2 that the Government of India would be able to achieve the FY22 divestment target of Rs 1.75 lakh crore and might even exceed revised estimates (RE) figures if the Life Insurance Corporation (LIC) initial public offering (IPO) goes as planned, CNBC-TV18 reported.

Elaborating on the Centre’s disinvestment strategy, Bajaj said: “In the past, governments were getting IPOs and FPOs, which was easy. However, our strategy on disinvestment is different.”

He explained how the Air India divestment did not get the Centre cash, “but has got us to achieve the target that we had set”.

The Revenue Secretary added: “There has been a continuous criticism on the FY22 divestment target of Rs 1.75 lakh crore and the government not being able to achieve it. So, we will have to wait. I am confident that we will not only achieve the targets but also exceed them.”

Quoting DIPAM secretary Tuhin Kanta Pandey, he said: “If the LIC IPO goes the way it is planned, then we will be able to go beyond the RE figures.”

Commending the work done by the DIPAM secretary, he said: “It is very difficult for people like us also to take these decisions as 10 years down the line, they can come back to haunt us. But, Tuhin has been able to perform well. It takes time for the engine to warm up and then it takes off. So, let's give it a chance to warm up.”

Tarun Bajaj then went on to speak about the GST rate rationalisation and said: “We have the group of ministers under Karnataka Chief Minister Basavaraj Bommai looking into the aspects of rate rationalisation, merger of rates, and correction of inverted duty structure. GST compensation is also an issue -- a window which ends on July 1 -- so that is also coming up for review.”

“The current revenue-neutral rate is 11.6 percent and it should be around 15 percent. The Centre is aware of these issues and the council would take it up,” he added.

Commenting on Finance Minister Nirmala Sitharaman’s announcement of 30 percent taxation on the income made from the transfer of virtual digital assets, he said the Government, after seeing information from crypto exchanges, decided they could not delay the taxation policy.

Bajaj added: “Suppose if tomorrow a decision is taken to ban the product -- just a hypothetical situation -- then we will follow the course.

The Revenue Secretary also clarified that his statement does not drop hints on whether the Centre is thinking of legitimising crypto or not.

Bajaj further said: “The Revenue Department is clear that if you are making money through these assets, then we have given the clarity on the tax treatment, including covering all areas. Please pay your taxes, the government is aware of the transactions.”