rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » FM's 'return' gift to cover all taxpayers

FM's 'return' gift to cover all taxpayers

Last updated on: March 2, 2011 20:51 IST

FM's 'return' gift to cover all taxpayers

     Next

Next
Santosh Tiwari & Vrishti Beniwal in New Delhi

The plan to exempt small salaried taxpayers from filing returns is likely to be extended to a large majority, both in government and private jobs. This, however, will be done step-by-step.

The proposal was announced in the Union Budget on Monday.

The chairman of the Central Board of Direct Taxes, Sudhir Chandra, told Business Standard the scheme would initially cover small salaried taxpayers who did not have any significant other income apart from interest on bank deposits.

Click NEXT to read further. . .


Image: Pranab Mukherjee sits before giving the final touches to the Budget in New Delhi.
Photographs: B Mathur/Reuters
     Next

FM's 'return' gift to cover all taxpayers

Prev     Next
Prev

Next

Sources say the scheme is likely to first cover those with taxable income of up to Rs 500,000 in a financial year.

"We will see the response. If it is positive and yields good revenue, the scheme will be extended to as many assesses as possible.

"If the scheme is successful, it will revolutionise tax regimes globally, as this kind of trust in citizens is not reposed anywhere else," Chandra said.

Chandra said the idea was to make assessees feel they were being 'trusted'. He said tax collections could be increased substantially by just trusting taxpayers.

The scheme, likely to be introduced from June 1, will benefit over five million taxpayers.

Click NEXT to read further. . .



Prev     Next

FM's 'return' gift to cover all taxpayers

Prev     Next
Prev

Next
Officials said initially, only bank interest income would be covered, but capital gains and income from property could be included later.

They said the government would have the option of asking a person to file his return if the information given in his tax deducted at source certificate did not match the details in his annual information report (which has information about a taxpayer's high-value transactions).

Those seeking refunds would also have to file returns, they said.

The scheme was proposed two years ago but could not be operationalised as many companies were not filing information about TDS online.

Officials say over 90 per cent companies now use the online platform.

Click NEXT to read further. . .



Prev     Next

FM's 'return' gift to cover all taxpayers

Prev     More
Prev

More

In case of salaried taxpayers, the employer deducts tax from employees and pays to the Income Tax department.

It reports the details to the department through TDS statements. This leads to duplication as tax returns also carry this information.

The plan will also ease the burden on the revenue department.

With the current strength, one officer has to scrutinise an average of 270 cases a year, which is less than the number of working days in a year.

Globally, the average is 60 tax audits per officer in a year.

To reduce the compliance burden on small taxpayers, the Budget has proposed changes to empower the government to exempt any class or classes of persons from the requirement of filing a return.

The changes to facilitate this are proposed to take effect from June 1.



Prev     More
Source: