Finance ministry tax collection in trouble as I-T officers launch nationwide agitation
February, 08th 2013
The finance ministry, which is on an overdrive to raise tax collections, is facing a roadblock from the very people who are responsible for filling up its coffers.
Close to 8,500 employees in the rank of income-tax officers, assistant commissioners and administrative officers of the Income-Tax department have announced a nationwide agitation and non-cooperation to draw the government's attention to their long-pending demands.
Starting Thursday, no member of the association will pass any assessment order, and from February 20 onwards, they will not participate in any search, survey and recovery action.
"In the absence of surveys and raids, it would be difficult for the government to meet its direct tax collection target of Rs 5.7 lakh crore," said a tax official.
Finance minister P Chidambaram recently asked tax officials to make all efforts to plug revenue gaps. But, protesting officers want the government to fast-track the process to look into their pending demands.
"CBDT members always find excuses not to promote field officers to assistant commissioner level," says Rajesh Menon, secretary-general, Income-Tax Gazetted Officers Association. The Central Board of Direct Taxes (CBDT) is one of the tax collection arms of the finance ministry.
"We have been told that the CBDT board, on the finance minister's instructions, will announce a cadrerestructuring exercise on February 15. However, we do not have any details of this and the contents are deliberately kept under wraps," said another Mumbai-based senior income-tax official.
These members will wear black badges, not cooperate in recovery work, and hold demonstrations during the lunch hour. "If the demands are not met, the agitation will be intensified. It will impact collections, but that's the only way the government would listen," said Menon.
The agitating officers are slowing down work at a time financial market analysts are trying to figure out how the finance minister will keep fiscal deficit below 5.3%. According to the data released by finance ministry, during the 10-month period (April-January), net direct tax collections stood at Rs 3.9 lakh crore as against the target of Rs 5.7 lakh crore. Direct tax constitutes personal income tax, corporate tax, securities transaction tax and wealth tax. According to tax officials, the I-T Department is grossly understaffed, and has been so for years. The decision to call a strike was taken after the managing committee of the association met this week.
Among other things, tax officials want the government to fill up vacancies, upgrade pay scales, clear promotions that are due, and provide new laptops along with data card in facilitating better working conditions.
"Till the time these demands are met, priority would be on processing refunds rather than quickening recovery. However, since the assessments get time barred on March 31, these would be completed despite the acute shortage of staff and insufficient infrastructure support," says another senior I-T official.
The revenue department has been taking a tough stance against not just defaulters, but also against those who paid less tax than last year. For instance, tax officials have been asking several companies to explain lower payment of excise duty and service tax over the past few weeks.
While emphasising that efforts would be made to end the hostile relationship between officials and assesses, the minister recently asked excise, Customs and service tax officials to beef up their collection efforts. It's unclear what course of action CBDT plans to take.