Delhi government to probe over 1,100 entities for tax evasion
December, 22nd 2014
More than 1100 hotels, banquet halls, gyms, health clubs and spas have come under Delhi government's radar for allegedly evading luxury tax.
Excise department, which is also in charge of luxury tax collection in Delhi, recently conducted a survey on the numbers of such entities to detect luxury tax leakage and found that there are 1149 unregistered banquet halls, gyms, banquet halls, spa and health clubs operating in the national capital.
According to a senior official, out of these 1149 entities, there are 66 hotels and 70 banquet halls, which are not registered with the department. Besides, there are such 617 gyms, health clubs and 396 spa running in the city.
"Survey was conducted by the department to detect luxury tax leakage. On the basis of survey's findings, we have now started examining the financial transactions of these 1149 entities to find out if they come under luxury tax ambit or not," said a senior official of excise department.
The official also said that out of 70 banquet halls found unregistered in survey, 24 banquet halls have registered themselves with the department and have been directed to pay luxury tax.
According to government norms, hotels charging more than Rs 750 from per customer for a room will come under luxury tax ambit. Besides, banquet halls, spa and gym having Rs 5 lakh turnover yearly will have to pay luxury tax.
"We are very serious over the tax leakage and after completing the examinations of financial transactions of these 1149 entities, we will take strict action against them if they are evading luxury tax. We will ask them to pay luxury tax ever since they came into being," he added.
Few months ago, the department had also asked police and tourism department, to give the list of hotels, banquet halls, Spa and others registered with them so that they can keep close vigil on their business, aiming at boosting luxury tax collections.