CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Indian Finance Minister Warns Tax Officers Of Difficulties Ahead

Indian Finance Minister Warns Tax Officers Of Difficulties Ahead

by Mary Swire, Tax-News.com, Hong Kong

01 June 2011


Indian Finance Minister Pranab Mukherjee told a tax conference this week that with a “highly uncertain” international economic situation and a volatile oil market the country’s tax department was going to have to work particularly hard to both achieve its targets for the current year and follow the tax compliance regime.

Mr Mukherjee was addressing tax officers at the Conference of Chief Commissioners and Director Generals of the IT Department, and informed those present that the tax collection target of INR6.64 trillion (USD146.8bn) was a 20% increase on the previous year. He said that the collection of direct taxes has almost doubled over the last four years, due to rationalization of the tax structure and improvement in tax administration through the use of new technology.

He said that the Direct Tax Code Bill was currently under discussion by the Parliament Standing Committee, and should be effective from April 1, 2012. The tax officers were told, therefore, to prepare for transition from the Income Tax Act 1961 to the Direct Tax Code Bill regime. Preparations will include issues such as the redrawing of business processes, rules, staff training and the implementation of the necessary infrastructure.

Electronic filing of tax returns, accompanied, by electronic payment of taxes, is being encouraged by the Government, although Mr Mukherjee admitted that there had been a large number of grievances regarding tax refunds and credits. He stressed that it was essential for the tax office to streamline its services and adopt an integrated approach to realize a “zero grievance regime”.

Litigation with taxpayers is a matter of concern to the Government, and the Finance Minister said that, on the recommendation of the Standing Committee on Litigation in the Central Board of Direct Taxes (CBDT), the financial limits for making an appeal have been revised upwards. These should reduce future litigation by around 20%.

He also said that there should be “zero tolerance for corruption” and that the department needs to focus on preventing any such opportunities. He announced that the Government has approved the setting-up of a Directorate of Criminal Investigation within the Tax Department. This directorate will be dealing with tax crimes related to illegal activities, and is aimed at strengthening the ongoing efforts in dealing with money laundering.

Mr Mukherjee’s overall message was that the Department needs to reinvent itself to meet the challenges it is going to face in the future. It should concentrate on its core functions of data mining, risk profiling, tax enforcement and educating the taxpayer, to enable an increase in tax revenue to pay for the necessary

TAGS: compliance | tax | business | tax compliance | India | mining | enforcement

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »