Finance Secretary Ajay Bhushan Pandey said Thursday that tax mop-up in the first quarter of the current fiscal year is "very promising" and suggests that the economy is improving faster than was expected at the time of lockdown implementation. At the time of filing income tax (I-T) return, he said the revenue department wants to bring in taxpayers' self-compliance by making available data on all financial transactions through Form 26AS.
Pandey, who is also the secretary of revenue, said around 70 percent of the Rs 91,000 crore Goods and Services Tax (GST) collected in June is attributed to May transactions."For the month of June, following current patterns, we have some pattern on how many people have paid so far, and also the e-way bill. truck movement all these items send promising signals that the economy is returning to the domain earlier than was expected when the lockdown began in March," he said while addressing a Ficci case.
In addition, earnings tax collection was around 80 percent of what was collected in the same period last year in the April-June quarter by way of advance tax and TDS."These two figures — GST and income tax — are promising figures and also give us some hope that companies can find ways to get started wherever possible, but there have been other sectors such as hospitality, education, tourism that face difficulties," Pandey added.
The government had revised Form 26AS notified in May that would have additional information on high-value financial transactions by taxpayers, such as cash deposit/withdrawal, property purchases made during a financial year, and would encourage voluntary enforcement and ease of e-filing of I-T returns.
Pandey said that if a person sees his entire transaction at one location, it makes it easy to file a return and helps honest taxpayers. It also sends a message to other people on the edge, so they'd want to be on the right side of the law too."What we want to encourage is self-compliance rather than sending a letter to someone and then someone going through some sort of abuse or trouble, we 're making all that information available," he said.
With respect to banks' digital lending, Pandey said that if a loan applicant's tax-payment profile is made available to the banks, it will make it easier for lenders to determine how much loan can be extended." we've got all this information, this information can be shared securely. we're working on it, we've had some sounds of meetings with multiple partners, and we're working on it," he said. Pandey further said if the tax base rises, GST rates could be further reduced.
"If we are able to follow our tax laws and everybody pays taxes appropriately if the tax base increases there will certainly be room for more tax cuts," he said. In saying that the ultimate aim would be to collect minimum taxes at reasonable levels, he said the "government would collect taxes that are absolutely necessary and we need to increase our tax base to that degree."
The government also is working on the number of GST forms, he said. Pandey said in the Pre-GST period there were 495 forms of 17 different taxes imposed by different states. After GST was introduced, the number of forms fell to 17-18, and we want to further the number of forms in GST, "he added. He added that no inspector raj exists with IT-enabled platforms.
