Income Tax department sets a 'not-so-easy' target of bringing 1 crore new people under tax net
July, 22nd 2015
The order issued by the CBDT, also accessed by PTI, has laid down region-wise targets. Maharashtra's second largest urban centre Pune leads the list with the target of over 10.14 lakh new assesses, north western states comprising Jammu and Kashmir, Himachal Pradesh, Punjab and Haryana over 9.30 lakh new assesses, and the newly bifurcated states of Andhra Pradesh and Telangana will have to contribute 7.93 lakh new taxpayers. Representational image File Photo dna Research & Archives The Income Tax department has set a target to include 1 crore more people under its tax net. Currently only 4 crore Indians pay income tax.
Given that India's population is over 120 crore, this number doesn't seem to be a stiff target but the department has chalked out a plan to meet this 'not-so-easy' target as only less than 4% of Indians currently pay income tax. The Board has communicated to the taxman that it should adopt a multi-pronged strategy to achieve this 'not-so-easy' target by holding meetings with trade associations and professional bodies and obtaining data on under-reporting assesses through technical and human intelligence.
The drive is a part of government's initiative to broaden the tax base, the Central Board of Direct Taxes (CBDT), the apex policy making body of the I-T, this week activated all field formations of the department to achieve the goal with the Pune region being given the maximum target of bringing in over 10 lakh new assesses.
The order issued by the CBDT, also accessed by PTI, has laid down region-wise targets. Maharashtra's second largest urban centre Pune leads the list with the target of over 10.14 lakh new assesses, north western states comprising Jammu and Kashmir, Himachal Pradesh, Punjab and Haryana over 9.30 lakh new assesses, and the newly bifurcated states of Andhra Pradesh and Telangana will have to contribute 7.93 lakh new taxpayers.
Similarly, Gujarat region has been given a target of getting more than 7.86 lakh taxpayers, Tamil Nadu over 7.64 lakh, West Bengal and Sikkim over 6.91 lakh, and Mumbai region 6.23 lakh assesses. The target for the national capital has been set at 5.32 lakh new assesses.
The tax department has a total of 18 regions in the country for purposes of collection of revenue under the major heads of I-T, Wealth Tax, and advance tax for large entities like corporates.
This goal, however, looks difficult to achieve given the feeble number of Indians who pay income tax at the moment.
These steps were mooted as the tax department is concerned over the "very small number" of people paying income tax.
Government data show that less than 4%, or 4 crore, of the total population currently pays income tax.
Keeping this number in mind, the target to bring 1 crore people under the tax net means that increasing the number of Indian who pay income tax by 25%.
The strategy in this regard was mooted and formally launched in May this year when CBDT told the tax department about the government's desire to have at least 25 lakh new assesses each month from across the country.
"With effectively eight months remaining in the 2015-16 fiscal, the target has now been set at one crore new assesses.
The CBDT and the tax department scientifically arrived at these region-wise numbers taking into account the revenue paying potential of these different regions in the country," a senior official said while explaining the new strategy.
The CBDT has also asked the taxman to clampdown on Tax Deducted at Source (TDS) defaults and ensure that big Income Tax defaulters are just not let off after slapping penalties but also prosecuted in a court of law.