Home Business Income dept ought to take motion to clear Rs 21 lakh cr tax arrears: Parl panel

Income dept ought to take motion to clear Rs 21 lakh cr tax arrears: Parl panel

Income dept ought to take motion to clear Rs 21 lakh cr tax arrears: Parl panel

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The Income Division ought to devise a concrete motion plan and a highway map to clear the backlog of over Rs 21 lakh crore of tax arrears, a Parliamentary panel stated on Tuesday.

The Standing Committee on Finance in its report additionally advised that the division ought to train due diligence earlier than finishing up search and seizure operations to make sure that sincere taxpayers usually are not harassed.

It stated that the division is caught up within the vicious cycle of tax arrears as greater than Rs 21 lakh crore (Rs 18.66 lakh crore in direct taxes and Rs 2.95 lakh crore in oblique taxes) are excellent.

It noticed {that a} main a part of the demand falls beneath the class of ‘demand tough to get well’ which constitutes greater than 94 per cent of the arrear demand.

With respect to oblique taxes, out of Rs 2.95 lakh crore, an quantity of Rs 2.58 lakh crore are non-collectible, that means that just about 88 per cent of the arrear demand is non-collectible, and solely 12 per cent of that’s match for restoration however not but recovered.

Acknowledging that tax recoveries acquired affected as a consequence of COVID pandemic, the committee famous that substantial arrears stay non-recoverable, which poses severe questions of the administration of the tax division.

”Noting the truth that tax arrears have been growing 12 months on 12 months, the committee would advocate devising a concrete motion plan and a highway map to clear the backlog by means of a time-bound fast-track mechanism,” stated the report of the committee, chaired by BJP member Jayant Sinha.

Asking the division to deal with search and seizure operations with ample warning, the committee stated whereas stepping up enforcement motion in opposition to wilful or power evaders, the division mustn’t alienate sincere taxpayers.

It stated that many particular person taxpayers have made representations to the committee members that they’re handled as ”felons” by income officers whereas the search is underway, and they’re typically ”requested for bribes in order that the search course of is truncated and/or deserted.” Asking the income division to completely examine any such incorrect doings, the report stated ”taxpayers ought to be offered a chance to supply confidential complaints in opposition to wrongdoers”.

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