« Top Headlines » Open DEMAT Account in 24 hrs  Delhi HC Rules GST Registration Cannot Be Cancelled Retrospectively Without a Clear Show Cause Notice (SCN)  Belated income tax return AY 2026-27: How to file, late filing charges and what you may lose  Major Financial Changes from August 1, 2026: ITR Deadline, RBI MPC Meeting, Tatkal Ticket Rules & More  Government proposes to ease tax relief conditions for offshore funds  TallyPrime Connected Banking: Automating Banking and Accounting  ITR Filing Deadline 2026: Is July 31 the Last Date to File Your Income Tax Return? Latest Official Update  ITR filing deadline nears: How to file income tax return online on e-filing portal - quick 15-step guide  Will the ITR Filing Deadline Be Extended Beyond July 31 for FY 2025-26? Here's the Latest Update for Taxpayers  Income Tax Refund Delayed for AY 2026-27? 5 Common Reasons Your Refund May Be Stuck and How to Fix It  ITR Filing 2026: FM Nirmala Sitharaman Asks Tax Officials to Let Honest Taxpayers Correct Genuine Mistakes  Will Your FCNR Deposit Stay Tax-Free After Returning to India? Tax Rules Explained for NRIs «  TDS on Esop: SC quashes case against Infosys... Banks want I-T cap on pension contribution to go... » Taxmen may source defence min supplies for adding to collections January, 10th 2008 The government is toying with a proposal to bring procurement contracts of the defence ministry under tax collected at source (TCS) net this Budget. If the proposal goes through, companies supplying to defence ministry will have to face tax deduction while receiving payments for such supplies. However, sources said the deduction would be made applicable only above a threshold. Also, the rate of tax is likely to be kept low. Sources said only large-sized contracts may be brought into the TCS net initially. At present, contractual professional, technical and other categories are under the tax deducted at source (TDS) net. TCS is applicable on paper, timber and tobacco, among others. In order to increase the compliance and revenue collections, the government may look at enhancing the existing provisions or introduce new ones to cover new/additional transactions, KPMG partner Vikas Vasal said.Earlier, the income-tax department had found that TDS collections from government departments have been low. Of the total collection of Rs 70,000 crore in 2006-07, just Rs 1,500 crore came from government departments. This is even as some departments like railways and defence are the largest providers of contracts. It had even proposed to conduct audits of such departments to ascertain the reason behind lower collection of TDS/TCS.Since TDS and TCS are considered an efficient way of collecting tax and establishing an audit trail, the government is keen on strengthening its administration. Under the system, the government gets its revenues outright while the taxpayer who does not have any income tax liability and can claim a refund in respect of the deduction made from his payment. The I-T department has created a TDS directorate with a view to tighten TDS administration with 12 commissionerates across the country having dedicated officers focusing on expanding the TDS network and ensuring greater compliance. All government departments, both at central and state levels, have been asked to take tax deduction account numbers (TAN) and e-file their returns every quarter.