Income tax refunds are set to get faster from 2007. The income tax department is rolling out the refund banker scheme from January 1. The scheme would enable tax payers to get their refunds from the designated bank directly. The department has tied up with State Bank of India for functioning as the refund banker.
The project is being launched on January 1 on a pilot basis in two income tax circles of Delhi and Patna, sources said.
Under the scheme, the department would send a list of assessees who have to be given tax refund and the quantum of refund with details like account number and permanent account number. The banker, after receiving the advice, will credit refund amount to a tax payer through both the cheque and electronic clearing system.
SBI will get Rs 5 for every refund through electronic clearing system and Rs 35 for every paper refund Rs 10 for printing of cheque and Rs 25 for speed post. The total cost of the pilot project is pegged at Rs 9 lakh. The project will be tested for three months till March to see if the concept works. If found successful, the scheme would then be extended through out the country.
Sources said if the scheme works out well, it would bring down the work load of field staff, who can then concentrate on their core function of revenue collection. This would also help the department in overcoming the menace of refund frauds. The income tax department had earlier outsourced the issuance of permanent account number cards and the collection of returns.