FinMin’s new amnesty scheme for service tax defaulters
Aimed at widening its revenue base from indirect tax collections, the finance ministry has implemented an amnesty scheme for service tax defaulters to pay their dues without any penalty.business Updated: May 20, 2013 03:22 IST
Aimed at widening its revenue base from indirect tax collections, the finance ministry has implemented a one-time amnesty scheme for service tax defaulters to pay their dues without any penalty or late payment charges.
The Voluntary Compliance Encouragement Scheme, which came into force after the passage of the Finance Bill on May 10, can be availed by a service tax defaulter by the year end.
A defaulter may declare his due tax liabilities, including the cess charges, for a period between October 1, 2007 and December 31, 2012 and pay it to the government after making a truthful declaration, thereby avoiding penalty, interest or any other penal proceedings.
The first-of-its-kind scheme was introduced by finance minister P Chidambaram while presenting the budget for 2013-14.
Of the 17 lakh registered assesses under the service tax net, only 700,000 were filing returns, Chidambaram had said.
“Many have simply stopped filing returns. We cannot go after each of them. I have to motivate them to file returns. Hence, I propose to introduce a one-time Voluntary Compliance Encour­a­ge­ment Scheme, he had said.
To encourage voluntary compliance by defaulters, the ministry has also decided to “reject” any enquiry or investigation against an evader, if he comes forward to make truthful declaration.