PAY your taxes honestly and in time. The income-tax department is now going whole hog after recovery of tax arrears.
As
a part of this exercise, the Central Board of Direct Taxes is creating
a data bank of those assessees who have defaulted on payment of tax to
the government and owe huge sums in arrears. The board has shot off
letters to field formations asking them to prepare lists of such
assessees, a government source said.
With data on tax
defaulters available at a click of mouse, the income-tax department can
work out special strategies for recovery of tax from them. One of the
options with the department is making the names of such assessees
public. Although, a final view on this yet to be taken, the option is
not completely ruled out.
The data bank would help the
board in day to day monitoring of the recovery on arrears front. The
board could then issue specific directions to field formations on what
strategy or action plan it needs to formulate to recover the arrears.
The data could also be matched with information being thrown up by
other information systems like annual information returns, to check
wilful evasion. The department has already created a software which
will help in creating a 360 degree profile of tax payers.
The
arrears which have been classified as difficult to recover by
income-tax department is pegged at Rs 1,03,900 crore. The total arrears
collection in 2006-07 had overshot the Budget target of Rs 11,700 crore
to reach Rs 12,285 crore. Majority of this demand is usually locked up
in various stages of litigation or legal proceedings.
While
the department is continuously looking for new avenues to enhance tax
collection, the general view is that emphasis should also be placed on
arrears. Encouraged by the arrears collections in 2006-07, the
department is placing increased reliance on it in 2007-08.
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