The government today said that it will ensure stable tax regime and clarity in tax laws. Finance Minister P Chidambaram said that tax collection will be more systematic and there will be non-adversarial approach in revenue collection.

He said that initiatives taken by the UPA government have started to show results and there will be some more changes and improvement in early October this year. Talking to media after addressing top brass of the Income Tax department and CBDT in New Delhi, Mr Chimbaram asserted that there is no need for anyone to fear tax collection.

The Minister said, the collection is growing at 10.5 per cent against the asking rate of 15 per cent but expressed hope that 5,70,257 crore rupees direct tax collection target for the current fiscal will be achieved.

Asking assessees to pay advances taxes by due date, the Finance Minister said that paying taxes is a mark of civilization. He exuded confidence that the collection will improve in the second half of the current fiscal.

Noting that India is the low tax country, Mr Chidambaram said there is need to improve tax to GDP ratio to 12 per cent.

At present, Tax to GDP ratio has come down to 10.1 per cent from 11.9 per cent in 2007-08.

Briefing about the meeting with top brass of Income Tax department, He said it was also agreed to fix the average effective tax rate for corporates at 24 per cent. Mr Chidambaram said, the government is trying to increase the effective tax paid by companies.

AIR Correspondent reports that this was the first interaction of Mr Chidambaram with all the Chief Commissioners and Directors General of the I-T department from across the country after he assumed charge of the finance minister. He recently held a similar conference with the top brass of the Customs and Central Excise officials who administer indirect taxes in the country.