There will not be any new tax cuts despite the drought affecting almost half the country. When asked if the drought will have any impact on the indirect tax collection, finance minister Pranab Mukherjee said today, "I do not know because I am not thinking of giving any tax concessions. Therefore, I am not concerned with that part." He was talking to reporters at the annual conference of the chief commissioners and director generals of indirect taxes.

The government has already extended three stimulus packages including sharp tax cuts and higher expenditure since September 2008. On the indirect taxes front, the finance ministry had slashed the excise duty by 6 percentage points and service tax by 2 percentage points.

The ministry aims to collect Rs 2.7 lakh crore in indirect taxes this fiscal. The Central Board of Excise and Customs would adopt innovative and dynamic ways for meeting the revenue shortfall, Mukherjee said. The reduction in tax collection, though worrisome, was largely due to the global economic slowdown, lower exports and imports and the stimulus packages, he said.

On the Goods and Services Tax, scheduled to be implemented from April 1 next year, the finance minister said, "Talks are going on. We have identified certain areas where there is convergence and certain areas where there is likely to be convergence and certain areas where we have to make more efforts." The empowered committee of state finance ministers was slated to meet on September 16, he said, adding that the contours of administering GST would be made public soon. "I am sure CBEC will be well prepared to meet the challenges arising out of introduction of GST. I expect the chief commissioners to rise to the occasion and ensure its smooth implementation," Mukherjee said.

On the withdrawal of the stimulus packages, he said finance ministers at the G-20 meeting had agreed that the economic situation was still not good and "it would not be desirable to work out an exit strategy at the moment".