President Pratibha Patil on Friday called for tighter laws to book tax evaders and sought enhanced global cooperation to fight the black money menace through domestic and cross-border measures.
Addressing the concluding ceremony of celebrations for 150 years of the Income Tax Department here, Ms. Patil said: “The war against black money has to be addressed both domestically and through cross border measures…There has to be continued [cooperation] through appropriate agreement on tax information exchange, and on mutual cooperation between countries to track down evaders taking shelter in other jurisdictions.”
On ways of tackling tax evasion within the country, Ms. Patil felt that while fostering an environment of voluntary compliance would help, “there is also need for putting in place measures, through laws and procedures, to ensure that recalcitrant tax evaders are brought to book.”
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Since last year, the government, on its part, has initiated various steps to deal with the black money menace, including the setting up of a number of committees to help estimate the extent of black money in play and suggest steps to tighten tax laws. Alongside, while the bilateral DTAAs (double taxation avoidance agreements) with other countries are under revision to include exchange of tax-related information, new treaties are being signed with other jurisdictions or ‘tax haven.'
Speaking on broad policy issues on taxation, Ms. Patil said the interface with compliant taxpayers, especially small taxpayers, senior citizens and pensioners should be initiated and maintained on a continuous basis so as to get a feedback on the difficulties being faced by them.
“Rectifications in systems and processes, if required, can then be carried out in real time. At the same time, the use of electronic modes for filing returns should be further popularised in the interest of greater efficiency…There should be periodic interaction between officers, holding of brainstorming seminars and workshops as well as study of international best practices and experience sharing...,” she said.
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Focus on e-governance
Finance Minister Pranab Mukherjee said that with its focus on e-governance, the Income Tax Department was planning to equip itself with the latest technology to benefit tax payers.
“The Department has focused on e-governance initiatives to meet the challenges of the rapidly changing economic environment and the expectations of the growing number of tax payers,” he said.
Lauding the I-T Department's efforts in revenue collection, Mr. Mukherjee said that it matured into an organisation that has consistently mobilised resources needed for funding the country's development. The Minister pointed out that direct tax now accounted for more than 56 per cent of the total revenue collections of the Centre, making the tax system more progressive than it ever was in the history of independent India. The direct tax mop up was Rs. 4.46 lakh crore in 2010-11.