Financial Daily from THE HINDU group of publications
Wednesday, Mar 01, 2006


Group Sites

Opinion - Income Tax
Industry & Economy - Budget

Accent on digitisation — The income-tax offices will undergo business process re-engineering

T. C. A. Ramanujam

The Finance Minister has set himself the difficult task of raising the tax-GDP ratio from 10.5 per cent to 11.2 per cent.

Having realised that it is not by raising the tax rates but by enlarging the tax base that would help achieve this goal, Mr P. Chidambaram has chosen to concentrate on revamping the tax administration by digitalising the same and making it modern, efficient and transparent. The income-tax offices will undergo business process re-engineering and a nationwide network will connect 745 of these offices in 510 cities creating a national database and national data centre. This is welcome.

Also, tax returns can now be filed anywhere — perhaps, this is what the FM means by permitting jurisdiction-free filing . At present, PROs in income-tax offices guide assessees to ITOs having jurisdiction to receive the returns. With e-filing, asseessees may no longer have to face this hassle. An innovation of sorts is the proposed introduction of the Tax Return Preparer to help the taxpaying public in filing their returns.

The Finance Minister has also announced that the status of refund claims can be tracked online. Tax refunds have been the bane of the Department. High interest is being paid on refunds, and interest on interest adds to the liability.

Refunds paid amounted to Rs 28,051 crore in 2004-05 and Rs 25,737 crore in 2003-04. Despite significant increase in collection, there has been no increase in the number of assessees in the last three years.

The number of taxpayers has fallen from 2,66,24,224 in 2003-04 to 2,47,92,990 in 2004-05. The proposal to make PAN mandatory is welcome. The AIR mechanism is being strengthened for this.

One-by-six scheme: The abolition of this scheme will come as a big relief for income-tax officers, who will spared of infructuous paperwork. After all, the numbers of those filing such returns have been falling.

Policy initiative: An innovative announcement is that every year the tax expenditure statement will be laid before Parliament along with the Budget papers, indicating the revenue foregone because of tax concessions and incentives.

This will make the Budgets more transparent.

(The author is a former Chief Commissioner of Income-Tax.)

More Stories on : Income Tax | Budget | E-Governance

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Full credit on the farm front

Big bonanza for the small car
A difficult task well done
Boost to booming economy
Not rocking the boat
Mixed impact
Encouraging competition
A `taxing' exercise
`Chai' with masala
Harnessing winds of continuity
Growth and equity
Undertone positive
Sad call for telecom
Continuity in momentum
Enhanced need for funds
Pragmatic, with few surprises
Ensuring the trickle-down
Budget hits all the right notes
No major reaction
Gathering pace
Judicious tinkering
Wiring up the nation
Taxes not recovered crossed Rs 1,11,000 cr
Services sector provides Rs 23,000 cr
Let down on CST
The wind is blowing, take cover!
A touch more than a stitch in time
Duty rationalisation for man-made textiles — More allocation for textile schemes; Rs 189 cr for textile parks
A few goodies for rural impetus, lower costs
Excise duty cut, a boon for small carmakers — `Small cars' are Maruti 800, Wagon R, Zen, Alto, Hyundai Santro, Indica diesel
No special drive: auto parts sector
`There's further scope for reducing raw material duties to Asean levels'

A positive program
Metals: Reflected lustre
A draft of demands
NBFC granted audience
Sighs of relief and dropped jaws — The FM seems content more at not ruffling many feathers
A liberal look to fringe benefit tax — FM has delivered what he had promised
Accent on digitisation — The income-tax offices will undergo business process re-engineering
How the tax breaks pan out
Tepid changes to corporate tax
Tame docile budget
Educational loans

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line