Latest Expert Exchange Queries

GST Demo Service software link:
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Popular Search: ACCOUNTING STANDARDS :: form 3cd :: empanelment :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARD :: cpt :: due date for vat payment :: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: TDS :: TAX RATES - GOODS TAXABLE @ 4% :: VAT Audit :: VAT RATES :: articles on VAT and GST in India :: ARTICLES ON INPUT TAX CREDIT IN VAT
General »
 The most thrilling idea before every Budget: No income tax
 Finance Ministry likely to tweak Minimum Alternate Tax norms to boost industry
 Income tax department warns people to keep away from benami transactions
 New helpline for income tax e-filing
 The Central Government notifies the Companies (Amendment) Act, 2017
 GST Returns: Government Relaxes Rectification Norms
 Will govt bring change in income tax slab? here's the present structure
 No income tax exemption to cooperative banks
 Bitcoin investors may have to pay capital gains tax
 What industry expected when Modi government implemented GST
  The Finance Resolution And Deposit Insurance Bill, 2017

Chidambaram wants to tax the super-rich to rev up revenue collection
January, 25th 2013

Beware, the taxman is watching. And he is taking an overarching all round view on your high value payments and purchases. The cashstrapped government has decided to step up the 360 degree profiling exercise of high net worth individuals and big spenders to rev up the slowing pace of revenue collections and reduce the soaring fiscal deficit.

A senior Finance Ministry official told Mail Today that the income tax collections are not commensurate with the big ticket expenditure that has been taking place in the economy on buying real estate, luxury goods, high value credit card purchases and extravagant spending in fiveâ??star hotels and foreign jaunts by individuals.

Finance Minister P. Chidambaram also stated on Thursday that there was a need to consider imposing a higher tax on the "super rich" at a time when the government needs more money to bring down the fiscal deficit. A top flight income tax official told Mail Today that the department had used "very advanced computer software to collect data on the expenditure of big spenders and efforts will be accelerated to gather all this data at one spot."

"The entity could be an individual, a family or a group of concerns. Once the entire spending is listed it will be matched with the declared income of the entity," he said.

"In case the expenditure, whether it be on consumption or asset-building, exceeds the declared income from various sources the income tax department will ask for an explanation from the concerned entity," the official added. He said the 360 degree profiling would also enable the IT department to crack the maze of companies through which entities operate to evade taxes.

"This is a scientific and impersonal way of tracking tax dodgers. The system that has been put in place is modelled on the lines of advanced countries such as the US, Britain, France and Germany," the official said.

According to sources, the PAN card provides the crucial link to the scattered expenditure and this is then assembled at one place to provide the entire picture at one glance.

Hidden figures

Well-heeled independent professionals such as chartered accountants, private doctors and lawyers, big shopkeepers and wholesale traders make up the category of income tax assessees who contribute virtually nothing to the national exchequer.

Figures compiled by the IT department show that during the assessment year 2012-13 only 14.62 lakh assessees have declared a taxable income of over Rs10 lakh.

This is considered to be a huge understatement as consumption patterns in the economy suggest otherwise, in the main large volumes of high value purchases.

On the other hand, data mined through the computer network has thrown up that 33.83 lakh persons made cash deposits of Rs.10 lakh or more in their savings bank accounts during the year.

Apart from this 16 lakh persons made payments of Rs.2 lakh or more against their credit cards and over 11.91 lakh people had purchased or sold residential property worth Rs.30 lakh or more. This data bank will now be used to track down the tax evaders. According to senior officials, more than half of India's 3.5 crore income-tax payers contribute insignificant amounts as tax with figures of less than Rs1,000 in most cases.

This reduces the effective tax base of the country to around Rs.1.5 crore taxpayers comprising mainly corporates and the salaried class, according to senior officials of the IT department.

Senior IT officials are of the view that the cost to the department for maintaining these numerous files would probably exceed the tax collections from this category.

While even a 3.5 crore number for income tax assesses is considered small for the size of India's urban population, the fact that the number of effective taxpayers is less than half this amount makes matters even worse for resource mobilisation.

Independent professionals and traders with lavish lifestyles are reported to be filing tax returns that reflect incomes ranging from a mere Rs.1.5 to Rs.5 lakh a year. The big cars that they use are bought in the names of business entities.

"These assessees have been showing withdrawals from their bank accounts of a paltry Rs.10,000 or so to run their monthly expenses which just doesn't make any sense," a senior official said.

Several big retail showroom owners in the posh markets of the Capital are reported to be showing losses on their books of accounts. The figures indicate that the business should have been shut down as the premises would bring in a huge rent but this is not happening either, an official pointed out.

Senior officials are of the view that there has to be a culture of tax compliance that is sadly missing in the country.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Sitemap

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions