Union Finance Minister P. Chidambaram warned service tax evaders on Wednesday that the ongoing amnesty scheme for service tax evaders, which ends on December 31, would be the “last chance” to comply with tax regulations.
Speaking at the inaugural of an interactive session with businesspersons, taxpayers and tax professionals in Bangalore, Mr. Chidambaram said the Voluntary Compliance Encouragement Scheme (VCES) is “an opportunity to come clean and make a fresh start.”
The Finance Minister said the Government’s offer is “fair and generous” and that such a similar scheme is unlikely for at least two decades. He pointed out that the last “true” amnesty scheme was launched in 1997. He pointed out that although 17 lakh service providers have “voluntarily” registered, only 7 lakh pay service tax. The ten lakh service providers who do not pay tax have been classified as no-filers and stop-filers, he said.
Mr, Chidambaram said that tax administrators, the Customs Department and the Financial Intelligence Unit have a “a lot of information (about tax payers),” gathered from various economic entities, which can be “used to identify tax evaders.” “Believe me, we have the information and the technology to construct a 360-degree view profile of such persons,” he warned. “This is how we have identified a number of chronic tax evaders, and arrest a number of such persons,” he added.
The Finance Minister said although 107 applications under the VCES have been rejected, they would be reviewed after the December 31 deadline.
Union Review Secretary Sumit Bose said 9,000 applications involving an amount of Rs. 2,000 crores have been received so far. Bangalore, he said, lags behind centres such as Kolkata in the matter of the collections under the VCES, Mr. Bose said.