Govt to scan advance tax for black money
The government is exploring options to set up a facility to monitor advance income tax filings by companies and high networth individuals, on the lines of dedicated monitoring of returns and tax deducted at source categories.business Updated: Nov 12, 2014 01:55 IST
The government is exploring options to set up a facility to monitor advance income tax filings by companies and high networth individuals, on the lines of dedicated monitoring of returns and tax deducted at source (TDS) categories.
The move is in line with the government’s plan to tighten the tax system and improve monitoring of domestic transactions.
It will also help achieve tax collection targets as the overall economic growth improves and companies report higher quarterly earnings, a senior income-tax department official said.
“The Central Board of Direct Taxes (CBDT) is evaluating the options and all factors will be considered before any decision is taken. It’s too early to say when the centre will be ready but we expect things to move fast as the department is committed to improve tax collection targets,” Vivek Varun Prasad, chief commissioner of income tax, told HT. “It will also help in faster resolution of grievances.”
The CBDT currently has two central processing centres (CPCs) for monitoring tax returns and TDS. While CPC for returns is located at Bangalore, the CPC at Gurgaon monitors TDS filings.
Although the location of the third centre is still being discussed, it is learnt that Pune and Hyderabad are being considered for their connectivity strengths.
Advance tax collection is closely tracked since it acts as an indicator of the health of Indian companies. Under the Income Tax Act, companies are required to pay 15% of their total advance tax in the first quarter (April-June period), while the remaining tax amount is paid in slabs of 30%, 30% and 25% in the successive quarters respectively.
The government has stressed on improving tax collection targets and bringing back unaccounted money stashed overseas. Recently finance minister Arun Jaitley asked the tax department to monitor domestic black money.