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The Finance Minister, Shri P. Chidambaram, addressing meeting of the Parliamentary Consultative Committee attached to his Ministry here today, said that electronic filing and processing of tax returns has made the system more transparent which in turn will help in widening the tax base. The Finance Minister informed the members that the cost of tax collection in India is less than one per cent in the case of Direct Taxes as well as Indirect Taxes which is one of the lowest in the world. The Committee Members complimented the Finance Minister and the officials for strengthening the tax administration through computerization and other relevant measures.
Addressing the meeting, the Finance Minister stressed upon the use of non-intrusive and non-invasive investigation and intelligence methods based on information technology to check evasion of taxes and to widen the tax net, instead of relying only on searches and seizures. He said that while the traditional methods like search and seizure have a role and have a demonstration effect, their effectiveness in terms of detecting concealed income or evasion of tax is limited. In fact, he termed them as blunt instruments which should be used rarely and selectively. These methods should be substituted by the intelligent use of information.
Addressing the concern of the Committee Members over the increasing number of disputes, the Finance Minister said that various methods are being adopted to ensure that the number of appeals filed is reduced and the total amount of litigation is reduced. The Finance Minister informed that the refund is credited in the bank accounts mentioned in the returns to avoid any delay and this facility is operational in 12 major cities at present. He also assured the members that government is seized of the seriousness of the vulnerability of data and adequate measures have been taken and more will be taken if necessary, to protect these from any intrusion or hacking.
Referring to the suggestion of reducing the number of tax officials involved in tax collection, the Finance Minister said that the staff is required as the TDS and Advance Tax returns have to be scrutinized and followed up.
Minister of State for Finance, Shri S. S. Palanimanickam and senior officers of the Finance Ministry were present. Among the Parliament Members who attended the meeting include S/Shri Bimal Jalan, Arun Shourie, R. Prabhu, Jivabhai A. Patel, M. Sreenivasulu Reddy, Prahlad Joshi, Angadi Suresh Chanabasappa, Pusp Jain, Tukaram G. Gadakh, P.C. Thomas, D.K. Adikesavulu, Tarit Baran Topdar, Narsingrao H. Suryawanshi, Jairam Ramesh, M. Rajasekara Murthy, Harendra Singh Malik, Rajkumar Dhoot, B.J. Panda, Dinesh Trivedi and S.M. Lajan Basha.
BSC/BY/GN-256/05
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