The finance ministry is working on a blueprint to restructure the revenue department, according to which sections like investigations, audit, information-gathering and vigilance will play a significant role.
The department is also mulling over increasing its power for trade facilitation, which it jointly carries out with the commerce ministry.
The plan for restructuring, which will be sent for Cabinet approval, has also been necessitated by manpower shortage in both the Central Board of Direct Taxes (CBDT) and the Central Board of Excise and Customs (CBEC). The shortage is particularly acute at the level of tax inspectors.
For instance, the shortage of manpower in the CBDT is estimated at 10,000, of which the revenue department has obtained sanction for recruiting just 3,300. Ministry officials said the department was trying to fast-track the recruitment since the normal government procedure could take up to two years.
While the restructuring exercise does not envisage creation of new departments, it seeks to strengthen areas like vigilance, information-gathering, systems and post analysis of data.
At present, a lot of the data is collected by the central information branch. Similarly, information is collected by the investigation department by way of the banking cash transaction tax and annual information returns. We are looking at more in-depth analysis of the data compiled by us, an official said.
Field level officers mostly focus on revenue collection. However, the same officers have to undertake the audit in adjoining areas, which we call chain audit. We are looking at the possibility of entrusting the work of audit separately, the officials said.
On the indirect-tax front, the exercise envisages a separate trade facilitation entity. The department at present has a director-general (safeguards) and a director-general (export promotion) but their work is done in conjunction with the commerce ministry.
Since there is an increase in the number of free trade agreements and bilateral trade, we need to set up our activity in trade facilitation, an official said.
The CBEC has already increased the number of commissioners offices for service tax to eight, from six earlier, in the wake of increased service tax collection. Two new commissioners offices have been set up at Pune and Hyderabad.