If you as a citizen of our country, are playing a hide and seek game with the income tax department; you ought to read this.

The Government has issued stern warning asking people to disclose their true income, or face the risk of an income tax scrutiny. The Finance Ministry has said, concealment of income while filing tax returns would not go unnoticed as various information of your transaction would be collated. While many of you in blithe or arrogance may think how they can manage to collate the data, let us apprise you that the scanner would be focused on all your transactions. Your spending and investment patterns would be carefully watched to know your true worth, against which are you paying your taxes legitimately.

So your transactions such as credit card usage pattern, dealings in real estate, investments in capital markets and cash held in savings account along with other intricate deals, would be under the income tax department’s scanner.

According to the Finance Ministry, only 1.4 million taxpayers disclosed income above Rs 10 lakh in the Assessment Year (A.Y.) 2012-13, but 1.6 million people made credit card payments of over Rs 2 lakh during the year. As many as 1.1 million bought or sold house property of over Rs 30 lakh, 3.3 million had cash deposits of over Rs 10 lakh in a savings bank account. Besides, 5.2 million people acquired mutual funds of Rs two lakh or more, bonds or debentures of Rs 5 lakh or more, shares issued by a company of Rs 1 lakh or more, and bonds issued by the Reserve Bank of India (RBI) of Rs 5 lakh or more.

We are of the view that this is a very vigilant step from the Government, intended to increase the country’s tax-to-GDP ratio, which is one the lowest amongst its peers. The net direct tax collection as on November 30, stood at Rs 2.7 lakh crore (of which corporate net tax collection was Rs 1.63 lakh crore, while personal net tax collection was Rs 1.07 lakh crore), as against the target of Rs 5.7 lakh crore for this year.

While robust consumerism and high savings rate is indeed important for the country’s progress, payment of legitimate tax dues is imperative; and thus by taking such stern measures the Government intends to increase net of tax payers. In fact about a couple of months back, the Finance Ministry was mulling ways of making tax payments, a fundamental duty to abide by. The National Council of Educational Research and Training (NCERT), has already introduced a wide variety of topics, including history of taxation, rationale for taxes, how the government raises revenues and spends as part of the curriculum, to be taught to children between 10-18 age-group; so in that sense a moral responsibility is tried to be infused at the very young age.

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pmahenderreddy@gmail.com Dec 12, 2012 Cool, Thanks for the information.

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