Union Finance Minister has said Income Tax department has taken various initiatives in past 2-3 years in order to increase clearness and fairness in tax administration. However, now there can be more initiatives of department to increase tax transparency.
I-T Department plan for Efficiency, Transparency & Fairness
Finance Minister said that single page ITR-1 (SAHAJ) form is set for taxpayers having income up to Rs.50 Lakhs. Addition to this rate of tax for individuals having income between Rs.2.5 Lakhs and Rs.5 lakhs is reduced from 10 to 5 per cent which is lowest in the world.
Government has set up concept of ‘No Scrutiny’ for first time and non-business tax payers can pay up to Rs.5 Lakhs income. Due to this more and more people are encouraged to join tax net and file their I-T returns also paying due amount of taxes.
Reduces corporate tax
Also, corporate tax is reduced to 25 per cent for companies up to Rs.50 crores turnover with covering 96 per cent of companies. However, new manufacturing companies build on or after March 1, 2016 are given an option to pay tax at 25 per cent without any deduction. Up to 15 years MAT credit allowed to carry forward instead of 10 years as part of procedural reforms.
This year 97% of income tax returns are filed electronically out of which 92% returns are processed within 60 days and 90% refunds also issued within 60 days. Further department has set up grievance redressal system name e-Nivaran which included all online and paper complaint to tracks them till they solve. Every complaint is accepted and decision is intimated through email and SMS. So far 84% of 4.65 lakh e-Nivaran complaint has been set on.
Highlighting initiatives of department
All cases of information are handles to avoid full search through e-Sahyog. Further, added to that about 1.9 crore salaried tax payers are informed every quarter by department of TDS amount deposited by their employers. All these e-governance initiatives of department have helped in direct interface between tax-assessing authorities and assesses. Also help in minimizing harassment, curbing menace of corruption and time-saving among others.
As far as doing business and promoting financial markets are concerned. In this regard, he mentioned about introduction of Presumptive Taxation Scheme for Professionals who has income up to Rs.50 Lakhs. Similarly, Presumptive Taxation Scheme for business income has been raised from Rs. 1 Crore to Rs. 2 Crores. And a company which is located in International Financial Services Centre has been exempted from dividend distribution tax and to pay MAT @ 9 per cent only.
Minister said India has entered into foreign association with 148 countries as far as exchange of information for tax matters and with 39 countries for criminal matters. But Double Taxation Avoidance Agreements (DTAAs) with Mauritius and Singapore were incorporated allow for source-based taxation of capital gains on shares and interest income of banks.
Impact of Demonetization
As far as black money is concerned IT department has taken various schemes since Government came to power. In this regard, Finance Minister talks about Black Money Act, 2015 of enactment, Comprehensive Amendments to Benami Act, 1988 and for others Operation Clean Money. Government has follow-up from November 9, 2016, to January 10, 2017 of data.
As result about 1,100 searches made arrest of Rs. 610 crore with cash of Rs. 513 crores. And secret income of Rs. 5,400 crores is notice and about 400 cases were referred to ED and CBI for right action. In order to promote less cash market and digital transactions the department took various idea, including penalty for cash receipt of Rs. 2 lakhs or more limit of cash donation to charitable trusts reduced from Rs. 10,000 to Rs 2,000 and no cash donations of Rs.2,000 or more to political parties.
Direct tax collections rise
In case of direct taxes revenue collections increase to Rs.8, 49,818 crores during financial year 2016-17 at growth rate of 14.5 per cent. Up to September 18, 2017 net collections increase to Rs.3.7 Lakh crores with growth of 15.7%. Also number of tax payers increased from Rs.4.72 crores in financial year 2012-13 to Rs. 6.26 crores during financial year 2016-17.