After the scrutiny of around 2 per cent income-tax returns filed during assessment year 2004-05, the Income-Tax department has raised a demand of Rs 60,000 crore additional tax.
The department is confident of collecting at least Rs 30,000 crore additional tax after the scrutiny of returns and subsequent demand notices issued to the assesees, sources in the finance ministry said.
The department had recovered around Rs 24,000 crore last year against the additional demand of Rs 56,000 crore raised after the scrutiny of returns filed for the 2003-04 assessment year.
So far the department has collected around Rs 1,50,000 crore as direct taxes, including corporation and individual personal taxes as against the target of Rs 2,10,000 crore for 2006-07.
In spite of shortage of around 20,000 personnel in the department, we are going to raise the heat against the tax-evaders through surveys, demand notices and other measures, without harassing the honest tax payers, Central Board of Direct Taxes (CBDT) spokesperson AK Sinha said.
He said with the availability of additional vehicles for surveys, the department collected over Rs 350 crore additional taxes during June-December 2006.
Going by our conservative estimate, we expect to collect at least Rs 10,000 crore additional revenue than the estimates by the end of the current fiscal, he said.
The investigation wing of the department had recently collected over Rs 250 crore from builders in the NCR region.
The department is also processing information collected through Annual Information Returns (AIRs) from banks, credit card companies, mutual fund houses and property registrars. Presently, India has the lowest cost of tax collections in the world.
If the government decides to increase the cost of tax collection from the present level of around 0.62 per cent of total revenue to 0.70 per cent, the tax evasion could be drastically curbed across the country, Sinha said.
Although the department is under the process of recruiting around 7000 personnel by June this year, it would still face severe shortage of manpower for scrutiny, survey, search and other operations, he said.