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Taxpayers to have an easier time

Finance Minister Jaswant Singh may announce some measures to make tax administration more friendly.

business Updated: Feb 25, 2003 12:00 IST

Finance Minister Jaswant Singh may announce a number of measures to make tax administration more friendly.

While the controversial recommendations of the Kelkar committee are expected to be put on the backburner, the committee's suggestions may be incorporated while finalising the roadmap for reforms.

According to sources, Singh plans to enhance investments in taxpayer services to 2-3 per cent of the income tax accruals of the government. This will provide additional resources for the income tax department to undertake reforms and make life easier for taxpayers. Currently, the department is allowed to invest up to one per cent of the total revenue from income tax and corporate tax. The Kelkar panel had suggested 5 per cent of the tax revenue to take up the reform programme.

Apart from providing for additional infrastructure, Singh would also indicate a timeframe of six months for processing all the income tax returns. While currently no statutory deadline is available, the Kelkar committee had said that all the returns should be done within four months once the income tax department is computerised.

The sources maintained that the timeframe for processing of returns would be linked to putting in place a massive infotech infrastructure.

Also, the banks would be asked to give refunds to assesses in case of dividend warrants distributed on behalf of corporate houses.

Massive infusion of funds to make the income tax department a "spruced up window" of the revenue department that could complete all the transactions online is expected to be announced by Singh.

Sources said that Singh has decided to announce the setting up of tax clinics or kar seva kendras to assist income tax assesses. The department, according to the sources, will also be asked to provide voice and mail services to any queries posed by assesses or potential assesses. High net worth individuals will be able to access the department through a separate window.

The finance minister may also announce major initiatives to put in place a tax intelligence network (TIN) based on the infotech infrastructure backbone created by the income tax department.

Already, the revenue department has decided to oursource noncore functions of the income tax department to UTI Investor Services Ltd, a 100 per cent subsidiary of Unit Trust of India. The UTI Investor Service, according to the sources, has been mandated to maintain the data bank and coordinate all the non-tax mobilisation activities of the government.

Painless taxation

* Six-month timeframe to process income tax returns

* Investment in taxpayer services to be hiked

* Online transactions to be made possible

* Tax clinics planned

* Tax intelligence network in the offing

* Special window for high net worth individuals

First Published: Feb 25, 2003 00:16 IST