Income Tax > I-T department and its 'surveys'

This is with reference to the article yesterday (25 Dec 2011) by Mr Srivats captioned “I-T Dept defends survey action, denies harassment of India Inc” in the Business Line.

 

IT department claims that they have collected 3,060 Crores, 4,857 Crores and 5,894 Crores in the years 2008-9, 9-10 and 10-11 respectively. It is surprising how the same evidence could be used by both the parties in support of their logic!

 

The very thing that so much of money has been ‘detected’ and ‘admitted’ shows the extent of harassment that has been perpetrated by the department. It is the difference in perception that leads them to pursue the idea that collection of money is legitimate government money.

 

In most cases, we have found, people admit and pay up not because they owe the Government any money but because they want the department ‘harassers’ out of their back. The very thing that there is an increase in collection over the last three years with decreasing number of ‘surveys’ and ‘raids’ shows that the department is slowly becoming masters in the art of harassment and extort money from gullible tax payers.

 

Yesterday one of the tax payers was arrested in Madurai. It did not catch the news media. What is important is that he was not served a notice, no legal procedure was followed. He was arrested because according to the department, he has  not paid dues to the government. Of course, arresting is within the powers of the department but then the provisions have been made for cautious usage not with every citizen in this country. It has been solely done to threaten him and rest of the people around as a display of their power and valour. Now, tell me will he accept all that the tax department says or not? Not only will he, people around him in the same market will also accept whatever the department says. Nobody wants to be arrested and harassed.

 

If the tax departments are straight in what they are saying, let them please answer the following questions:

 

1.       They set target collection for audits and for scrutiny-s. How can one set a target for these? Do they foresee the extent of violation people would have made even before they are scrutinized? In one of the meetings organized by the tax departments, a scrutinizing officer says, ‘The commissioner can set any target he wants. We will meet it!’ amidst thunderous applause from his colleagues!  I wonder how this is feasible. It only goes to prove what is the impact of harassment on people.

 

2.       How many small and medium size tax payers vanish from their business, close down and go, after they are served notices by the tax department? Our survey indicates a phenomenal 32% of small and medium businesses close down after the tax department serves notice on them. Or they wind down their business gradually closing it after two to three years. Legal or illegal is not the issue. You are killing people that is more important.

 

3.       After the scrutiny process of income tax department, department invariably claims a large tax collection. What happens to the tax collection in the following years from the same person who was scrutinised? Again the association of tax payers has collected information pertaining to people whose scrutiny was closed in the year 2008. We found a gradual reduction in the total tax amount paid by individual tax payers. Corporate bodies behave differently. However, individuals slow down their earnings so much so that the loss to the revenue is over 30% on an average in the first year after scrutiny increasing to well over 55% on an average, in the third year after scrutiny from the same person. In many cases, they end up with in the exemption limit! What is the purpose of scrutiny, increase tax collections or reduce it?

Should I join an organization for social work?

Hold it!

I joined 5th Pillar the organization that is fighting against corruption in the country. Well, I may not be going on the roads to shout hoarse at what is happening in governance. As you might be knowing, I am a positive guy and work proactively on all the wrong that needs to be righted.

Government as we already know has a very dirty role to play. It is certainly an unenviable job. Not that it cannot be righted. It can be. That is why, I thought, I would join up 5th pillar.


So today, I joined them in full and paid by life membership. Let us see what happens there.

How do we fight corruption?

There has been a mixed response whenever I spoke about corruption in the Indian Society. My short talk in CII and later my discussions at 5th Pillar Coimbatore evoked similar response.


People find it difficult to dismiss my thought sequence. But at the same time, they do not want to accept it either. May be, because it is too much of a thing to accept.

I have been telling them our fight should be more proactive rather than reactive. Whereas reactive methods of fighting corruption would only be postmortem; after the damage has happened. Law can be invoked only after a breach of law has taken place. Do we want to stop corruption or do we want to punish corrupt people?

If punishments alone could deter people from committing crimes, by now, we would possibly have all crimes stopped by now. If punishments is the way legal conditioning should go, then why is it that many countries have subscribed out of death penalties? Why is it that we do not subscribe to the view of punishing children? Why is it that India has signed out of 'spare the rod and spoil the child' syndrome?

Punishment is not the way to go. Being a non-violence driven society, we need to look at how to become a truly non-violent nation. We should look at how to 'make' laws that live with people and not 'make' people live with the laws.

If a small number of people violate the law, then there is something wrong with the people who are violating. If the majority of the people are violating a law, then there is something wrong with the law and not with the people!

It is time we take a relook at those laws that are violated by majority of the people and take a close look at why it is being violated.

Escalating violence - Terrorism, Maoism and the myth of military solutions

One more round of violence and one more round of news coverages and political talk!

Where are we proceeding from here? What are our solutions to such a terror attack? Be it Maoist or Islamic Terrorist or a Hindu Chauvinist.

We all talk of violence breeds violence syndrome. What was the cause of violence? Who started this violence, where and how? Is there an end to this violence in sight? Will it end at all? Many questions arise during these post bomb blast days and we promptly forget it after ten to fifteen days when new scams and news dominate our newspaper front pages.


Many people call for very strict action! What they mean by it I do not know. But all that I know is every time when a police man stops my vehicle for checking its contents, I get irritated. Is it right for the government to step into my private land? Yes, for the sake of lives of so many people, including my own, I should allow it to happen. There cannot be a privacy that could endanger the lives of so many others.

Remember the emergency days. It is this trespassing of the government into private territories that ruined the life of Congress and dethroned them creating a fresh new government. A new challenge to Congress that never existed before!

I for one, think that all these manifestations of violence and blood from whomsoever it might term as terrorists, Maoists, etc., are all but repercussions of the violence and high handed behavior of the Government. If only, the government and its forces had not misused the power the people gave it to monitor themselves, all these would not have arisen.

We, the people, has made the government a trustee of our trust. We have given powers to the government to execute the will of the people! There is no will of government that exists.

When the power that we bestow upon the government is misused by them, then the people react in a number of ways. Three of them is very common!

One, they elect a different person to head the government. This is repeatedly happening in India. People are trying to see if this guy would be better than the other. Every time there is an election, there is a change in the government. People feel that the government is misusing its powers and is not performing as they are supposed to!

Two, they respond with the weapon that they are free to have. Money! Money is used to buy what they want. The officials of the government who need to implement the power that the government has, are bought by the people resulting in large scale corruption.

Three, there would be people who would respond violently at the use of power by the government. Or rather, misuse of power. This results in terrorism, Maoism and other forms of violence.

But there is one common cause for all these. And that is misuse of power by the Government. The real cause of corruption, terrorism and change of government is the large power that the government is enjoying. Whenever any of these happen, instead of reducing the power in the Government, what we normally respond is with a new law. Either a new anti-corruption law or a new  anti terrorism law or a new law that would ensure that there is no change in the government at least for five years.

In all these cases, the government is contra to the requirements of the people. It will result in more of all the three. A government where it might have to depend on multiple parties for its existence resulting in an absolutely unstable government. A large scale corruption that cannot be stopped by any law that this government could think of. If they put their foot down and could really implement the law, then it would result in an escalation of violence!

And what is the best and the easiest of solutions! Work for a carefully planned reduction in power in the Government and make them more federal! All others are temporary and might lead to more complications.

Meeting at CII Chennai on Corruption

It so happened, I was in Chennai on 12 July 2011 and happen to participate in the discussion on Corruption Free India!

It was an occasion to meet many individuals who are possessed of this idea. Representative of Indians Against Corruption and members of 5th Pillar made a mark. I personally, could discuss and present my viewpoint of the whole thing. I could see some of them were impressed and seem to spend a thought or two on my proactive theory rather than reactive response to any of the problems that this country is facing including corruption.

I had a reasonably long chat with Mr Vijay Anand, the President of 5th Pillar. We thought there are many common interests, naturally, between India Tax Payers and 5th Pillar. We should try and work together. That should synergize our efforts to a great extent.

The solutions offered at CII otherwise were more in the line of implement stricter rules and make things tougher for the corrupt person to lead a life. At the same time, we had positive notes coming up from Shankar Vanavarayar and from other speakers particularly, TT Ashok on the strengths of our Industry and people of country to fight this evil out from individual level to the country level. Bottom up system!

Direct Taxes Code - the fallacy

Aims of DTC

The aim of the DTC as suggested by the government is to ‘simplify’ the income tax rules so that common man like me could understand the conditions. But on simple reading of the DTC and ITA (Income Tax Act) will show you that it is actually the reverse!

DTC is not aiming to solve any of the major problems that plaque the direct taxes regime in the country.

1.       Tax Compliance.

2.       Flight of capital from the country.

3.       Encourage FDI.

The government does not claim to have solved any of these problems and neither has them attempted to in the DTC. Without any radical changes in it, the DTC is just another annual ITA exercise. Why make a fuss of it?

Tax Compliance

Will DTC bring in better Tax compliance? There is absolutely nothing new in the law to encourage people to be more compliant.

By default, Direct Tax is a negative tax. In the bygone ages, oppressive regimes introduced direct taxes to skin the conquered nations off their wealth. Socialistic legacy in this world believed uniform spread of income will solve social inequalities. Last few decades have established beyond doubt the weaknesses in the socialist theories.

Why is this, a negative tax?

Any tax that does not encourage growth in the country; on the contrary discourages growth is viewed as a negative tax. Slab rated increase of income tax or direct taxes is a negative tax that aims at discouraging people to earn more. Government is informing its citizens, if you earn more you need to part with more or when you earn more you enjoy less of your hard earned money.

Naturally, there is no surprise in finding more defaulters than people who are compliant. DTC does not try to make people more compliant. It is more of a negative tax. You will only end up with more defaulters and not willing compliance.

Any law that is not in line with the thoughts of the people will never be obeyed. The reason why there is so much of corruption in this country is because most of the laws of the land are not easy on the people. They are not in line with the lifestyle and they are far away from the ground realities. Either they have to break the law and have a rebellion or break the law and escape by being corrupt. The Indians chose the second, which is easier.

DTC is not in line with the thoughts of the people. People want to make more money. They want to be economically stronger; whereas DTC penalises them when they grow. Tax rates go up when you earn more money. What the law wants people to do is, either do not grow or at least, do not announce that you are growing. Suppress it! 

DTC will only increase the black economy. Is that what is needed?

On the contrary, if there is a decreasing slab rate of income tax as the income increases, then the government motivates people to earn more. There is reason for me to show more income on my returns.

Flight of Capital from the country

There is so much being said about money going out of the country to ‘tax havens’ and to many others. If those countries are tax havens what are we? Tax Hells? 

Flight of capital from a tax hell to a tax haven cannot be stopped unless either one of them changes colour. As a strongly worded presentation done in the United Nations by our permanent representative says, there should not be a place called tax haven!

There is also another way to handle the situation. A much easier one, at that! And that is, we change color. 

Why should we continue as a tax hell and why should we not become a tax haven, after all!

DTC, again, does not address this issue of capital or fund movement out of the country. Strict controls have been laid down by the RBI and careful watch dogs are employed to monitor such flight of money from the shores of this country. But how successful is that?

Generally, money flows from a richer country to a poorer country. When it flows in the opposite way, some pumping of money is happening. This can happen only when people realise that money in the poorer country is not congenial for its growth.

Take a look at what happened with gold smuggling in this country. The government tried all means to control the smuggling. It only rose even after tranche after tranche of gold was held at the harbors and at the airports. How did it all stop? The government decided to reduce the customs and to de-control gold. You want to import gold, do so, freely! Now where is the smuggling of gold? The government created the business of Smuggling in this country. It had to be stopped by the government.

The same way, the government has created the business of black money. It has to be stopped by the government. Easy, remove income tax. Black money will cease to exist from the next moment!

Encourage FDI

One of the main purposes of the DTC is to encourage FDI. Though, I think, it has succeeded to some extent by giving some clarity and reduced ambiguity, at least in the cases pertaining to GAAR and CFC rules. To what extent, this would increase investment in this country might require a long wait and watch.

There is no new ground broken in DTC which could be called as a reason for increase in FDI. Yes, more clarity and simplification of the law would encourage FDI.

However, as indicated above, categorical changes in DTC to be in line with growth expectations of the people would increase FDI drastically. Whereas, the current system of complexity in taxation regime will only lead to more litigation as it did, and is doing, in the case of Service Tax regime.

Conclusion

Worldwide income tax abolition is becoming the most sought after requirement of the tax payers. 22 countries have accepted this and have charted out a roadmap for the same. Our recommendations are as follows:

1.        

      Direct Taxes should be abolished and they should be replaced with an equivalent consumption tax to avoid any drop in revenue to the government and it is Green as well.

2.      If not, the government should have a time bound plan to abolish Direct Taxes and a clear road map for the same should be worked out. This should be the content of the DTC and not what it has now.

VAT rise in Punjab…

Punjab, the land of wheat in India is shockingly increasing its VAT for wheat and with this all traders take a turn to its peers Rajasthan and Uttar Pradesh….

So this needs some more explanation. The tax we total should possibly constitute branched minor taxes…. The traders basically pays 14.5 % which could be divided into 5 % VAT, 2 % of it moving to the rural development fund, 3% cess and 2 % commission to the agents.. In Punjab flour millers have to pay 10.5 % percent taxes…

Things are different in Punjab’s neighbors… It’s high enough if the trader pays just a 4.6% to buy wheat from the state of Rajasthan with a minimum support price… In Uttar Pradesh, traders need to pay 8 % to get wheat and this is comparatively lower to what Punjab charges... flour mill owners don’t have to pay higher taxes and they are…

Rajasthan announced that the state offers an exemption to all the private millers and so all can come over to their place to buy wheat… This is great news to all wheat sellers with Rajasthan charging costlier taxes… So all agricultural operative domains and private wheat trading will stream to Rajasthan…

Many flour millers feel Punjab is higher in VAT and with the same quality wheat could be got in other states with a full exemption… If Punjab has to sell well, then all it has to do is to bring down the VAT to that of the peers…

Punjab has always had a higher rate on VAT for wheat… However quality is typical in all the three states with no further differences… Though Agricultural corporate concerns choose Punjab for wheat, private buyers go for the other two states…

For more comprehensive news on tax visit http://www.indiataxpayer.org/

Indirect taxes and India…

As what RBI says, taxation in India is becoming unmanageable with possibly less credible features… The indirect tax needs to be put end else then things would go far worse…. The current income measures more than what it shouldn’t be over the current expenditure… So this can be a pivoting factor for higher indirect taxation…

The previous financial year was good at indirect taxes showing a neater sweep…. The collection number was estimated to Rs. 3.42 trillion with a significant growth of 40%... There were fair exemptions that year…

The hiking price of the fuel makes it to considerably lower the indirect tax and what is direct is that if price increases the stress to lower taxes on fuel could eventually come up… However taxes are reduced, enabling them in other ways is really easy…

Fuel tops the central excise tax collection with a 48-61 % and this would potentially continue this year if prices keep rising with no limit…

If prices of fuel go up, all it would push is the necessity and the importance of itself in the share markets… furthermore with a larger increase in the indirect taxes like customs and duty, people never fathom the mounting hike… With added inflation, another stronger feasibility crops to promote the price hike… India is on the top with high indirect taxes on a comparative basis with Nepal, 18%; and Sri Lanka, 9% and Pakistan 24 %...

All the government needs to do is a makeover and break off to the three taxes… It should significantly consider replacing these with the GST or the Goods and Service Tax that could eliminate indirect and unfair levying… If the three taxes continue to exist, then all India should be doing is to face an endangering situation and a weaker economy…

For more comprehensive news on tax, visit http://www.indiataxpayer.org/

Gold in India- The current scenario

Gold in India is becoming costlier yet the demand hasn’t come down yet… This is a 25 % to a 400 % which is a great increase both in demands and price… Also the World Gold council came out with the news that India is the only country that is in need of vaster amounts of gold as to what other countries are… The need for gold in India climbed up the ladder to about 30 percent which is reasonably a steep rise… The World Gold Council also says India’s demand over gold will keep increasing over the years and betting higher in 2020 with 1200 tonnes costing 2.5 billion rupees...

India shows real growth in the levels of gold with a patterned increase of 3 % per annum… This turns to be a good move with a finer credibility in demand and buying… In 2010, all it reached was 963 tonnes and this clearly shows sale price of gold depends only on demand and not on the increase in price… However India has been marketing gold considerably with good profit and ever existing demands…

Gold trading in India cannot be really compared to other countries… Indian women have a great affinity towards gold and ornaments... Studies show that India houses 32 % of Gold in the whole world… so what of it would account to no lesser than18,000 tonnes.. India’s annual GDP will continue to possibly grow to in and around 10 % no father than 2015, nevertheless it might also turn topsy turvy to an 8.5% percent in the farther few years..

Gold demand in India can also be attributed to the rising people, growth of GDP, stronger fund generation and inflation.. Many researchers also say that the high end selling of end is also due to the rising price of gold wherein demand is a lot higher than what one could usually expect…

A era based study done clearly accounts all the information on Gold trading like interest rate, the exchange rate, personal income tax… However the buying of gold stays reasonably high on a rising price rate…

For comprehensive tax news visit http://www.indiataxpayer.org/

No Tax Exemptions for ICC

The ICC and the tax exemption, a serious topic now… The Indian government announced that the ICC cannot have a tax exemption and further explanations include a lot more than taxation… The government made sure that the tax has to be paid and sports are not exceptions when it comes to paying taxes furthermore making it clear that Sports are latent businesses that prosper and make good money… Even if there is going to be some kind of neutering over the tax rules, regulations in levying will remain the same…

Exempting sports from taxation, predominantly cricket shouldn’t be right where the ICC has proved itself flourishing to become a business channel in the past few years generating much more revenue and popularity… The Cricket Council has a lot of sponsorships and media partners and this makes it more considerable when it comes to paying taxes…

In Income tax rules, there were options for nullifying taxes for ICC champion’s trophy in the near past… The ICC must be paying taxes from the Income that it gets from the World cup winning…

Many a time, it was the Government granting offers for the world level organizations setting up sport events in India wherein it would significantly exempt taxations … It is all done on a common basis with a good political backing….

All these need to be removed with the Indian Government setting up a neater rule for levying in sports...

For more comprehensive news on Tax , visit http://www.indiataxpayer.org/

Tax on Foreign Exchange trading…

The service tax on the foreign exchange trading and operation get to be deduced to Rs.50000. Creating a wave of happiness amongst foreign exchange traders this is enjoyably inviting. If not into actions things may change into higher service taxes on the FOREX area however the announcement is finally made…

The taxes for the FOREX are basically manipulated upon the money got from the transaction with a 0.1% of gross amount of currency exchanged… The amount can range until 1 lakh and the minimal tax should be around Rs.25…If it is a 10 lakh then the tax must amount to Rs.100 with a 0.5 % Gross amount exchanged…

If transactions go above 10 lakhs , then the tax should be Rs. 550 for 0.01% of currency exchange…. However the maximum service tax here should go to just Rs.5000…

In the past banks levied a 12.36 % on the FOREX transactions where the service fee would be around Rs.100 totally amounting to Rs.112.36 for each transaction….

As of now things are not the same….. The budget changed the rules with different rules applied…

The Government now has announced two ways to calculate the service tax to foreign exchange transactions… In the first procedure, the service tax that is calculated would be from 0.1% of the gross amount exchanged…. The second parametric method would be that service tax must result from 1% percent difference of the trading rate and the RBI reference rate of the current day with all parameters included for calculation…

There are mixed opinions resulting to this situation… Nevertheless things have to go on a smoother way to ensure that the service tax does come down sensibly…

Excise Duty and Textile Industries

After a massive outbreak of protest from the part of textile domain, the government decided to possibly dissolve the increase of 10 % excise duty on textiles and branded garments…. Textile merchandisers around the country involved in a demurral were furious and were never withdrawing…. Though with a decision of bringing a partial break off to the levied duty people aren’t still happy eventually continuing to protest for a complete exemption…

This budget was a big bad news for the textile and garment industries as the proposed levying of 10 % excise duty made it inevitable to achieve peace…

Finance Ministry though brought out ideas of reducing the retail prices to 40 to 55 percent…. Sources also say that for an SSI exemption all that the domain needs is to produce a turnover based on the retail sale price this year which amounts to 8.9 crore….This eventually took a turn where the retailers and traders protested with a tag “ big hit to smaller industries” ..

The breakout predominantly happened in West Bengal involving an opposition from some of the famous industries… Ludhianians and people of West Bengal top the strike to deduct excise duty… The clothing manufacturing association of India announced that the strike can take things into further worse conditions with 50,000 units striking and 25 lakh people lined up protesting……

For more news visit http://www.indiataxpayer.org/

Transformations in Taxes and Banking Procedures…..

The Indian federal government presented a drat bill in the Parliament a few days back. The bill integrally aims in bringing the GST into action no sooner. GST or the Goods and Service Tax is one of the most talked hot topic of the country where people believe that the taxation process can significantly eliminate the service tax, excise and the customs duty.

The Indian government decided to enhance more than two banking laws and rules relating to voting settings of people who hold considerable shares. GST needs to be enabled because there could be a wider possibility that enhances uniformity in the levying.

The Banking Laws (Amendment) Bill 2011 is one of the bills passed to potentially enrich the central bank’s control ensuring that the bank can access information from mutual funds and other associates concurrently.

The current banking rules allow rights to shareholders no more than 1% in government banks and 9% in case of foreign banks how much ever equities the person holds. The bill proposes to bring an undeviating rate in nationalized and foreign banks as well making it from 1 to 10…The regulations in the bill state that there should be an extra bonus to the shareholders predominantly in accessing their controls.

The bill’s enhancement also deals with the fact that there can be a farther rise in the government banks capital a lot more than what was just $668 million…If the bill gets approved then the next step could possibly be the Reserve Bank of India(RBI) accepting the mergers and setting those free from other acts..

All about NRIs and Tax saving…

Living overseas doesn’t anyway affect possibilities. Indians, living overseas save money in dual aspects branching into putting them predominantly in overseas accounts and Indian accounts. However the Non resident Indian needs to take a look at all the taxation procedures furthermore helping him best understand what Indian taxation is all about.

A NRI should most importantly comprehend the fact that he has to pay taxes for whatever that comes out of his property or assets or investments or far closest, something that belongs to him generating considerable income in India; nevertheless he wouldn’t be paying for what he earned outside the country. Yet again, Foreign Income and Indian Income need to be best taken in with no confusion. Receiving an income in India Wherein generated anywhere not specifically India, this gets termed Indian Income. Foreign Income is when there is an Income generation and obtainment outside the parent country.

With the Income tax act of 1961 there are options that permit tax deductions for NRIs ensuring a complete pass in the designed rules. Certain Incomes for NRIs are tax exempt namely the NRNR and foreign currency deposits, the foreign income, dividend from Indian companies, Mutual funds and long term capital gains triggered from a well known stock exchange with a mutual fund tax exemption at par with citizens, if on getting a fee from a consultancy that holds offers for employees under a sponsored program where money comes from a non resident country.

Areas of deduction are quite possibly flexible. Availing deductions from home loan interests and the EMI are okay. When it comes to savings, then there are lots more tuned options like equity investments, debt investments, NSC, Pension plans and Life Insurance and Fixed deposits.

What NRIs can’t do is that they wouldn’t be allowed to open a PPF account however if it’s already active it shouldn’t be working anymore after maturity.

Investments in National Saving certificates, Senior citizens savings scheme, Post office time deposits are definitely unavailable to NRIs...

NRIs can demand deduction in premium of Health insurance and medical policies. They can also opt for loan deductions in the areas of education, medical facilities and so on.

However every NRI has to best effectively understand rules for an implementation that comes out errorless...

9% growth expected in 2011-2012

The Finance Minister after announcing the Budget and the Finance Bill says there should be an anticipated growth of 9 % in India. The investment rates are no lesser than 35 % and this can trigger the wanted development in FISCAL year 2012. The possible developmental aspect is manipulated to be in and around 9 %...

The budget design is a relaxation from huger levying whatever it struggles from the aspect of inflation. The tax rollback on the health care sector does show a good prospect until there isn’t another levying done where there are news stating that this operation is not going to be a constant relief.

Also concentrating on sectors that encounter higher and partially cut levies, India might come down considerably. Garments, textiles have a huger levying this time and that it has left retailers unhappy. Automobiles had partial cut on their levies which still doesn’t account to their production leading to an increase in the cost of their products. Banishing STPI isn’t a right move letting SMEs suffer higher taxations furthermore suspending the tax holiday procedure.

Food inflation, though cooled for a significant period does seem to have a sharp rise again over a shorter time. This time it is 10.05 % rather than an estimated 9.42% that dated a week back. Taking steps to bring down food inflation doesn’t seem to be credible this time. Comparative signs show that the food inflation stepped down from a steep as to what it was in the last six months.

The levying hike posed on the crude oil prices is one of the biggest perils all over the world. The fuel prices going up the ladder won’t come down. A lot of potentially disastrous events including the Tsunami, Libyan Crisis and the Fukushima Daiichi failure stand behind the hiking. The mid east doesn’t offer satisfyingly finer amounts of oil lifting the prices greatly. This year the country was expected to have 100 million tonnes of oil wherein there was no more than 67 % causing a scarcity of fuel. A barrel is priced around $115 now. The government denied the reduce of levying on petrol until there is a final proposal that restructures the taxation on fuel.

For comprehensive news on tax visit http://www.indiataxpayer.org/

Tax Prevarications- PAN cards keep multiplying…

A lot of people keep equivocating taxation by surreptitiously possessing many PAN cards (Permanent Account Number)under single identity. This seems to be another perilous issue for the Income tax officials furthermore there are lots already waiting under dodging regular taxation.

The Income Tax Department has released no lesser than 10 crores of PAN cards this year, however the taxes paid don’t anywhere come near half of what the number is. The tax income this year on a comparative scale just rounded up to 340 lakhs and that shows there are lots of other PAN cards which are employed to barely operate on evading taxation.

The officials have plans to stumble on people who possess multiple PAN cards. Drawing on a PAN card is primarily to furnish an identity that is unique and that doesn’t conflict. A consumer can use this PAN card to begin a bank account or any other instance that requires permanent identity. The reason why a PAN card is employed gets completely ruined if there are going to be more than a lot of multiples.

Higher authorities keep checking for duplications with similar names and also those possessing same addresses on the forged versions. This process of checking wouldn’t end rapidly as there are lots holding falsifications in the same. The central Board of Direct Taxes brings out a truth that the pause that comes between the taxes and the PAN cards is predominantly due to the duplications but with lesser chances of considerable death of PAN card holders.

Surveying the issue makes it more clear that death of PAN card holder insignificantly affects the pause that exists between taxations and PAN cards. These need to be directly proportional. If there is going to be an increase in the number of PAN cards issued then it means that there must be a higher tax paid whatever neglecting the amount of people who establish PAN cards as their identities, for paying taxes rather.

All these are required to be broken if there should be a considerable rise in the Gross Domestic Product the market values of the merchandising done in the country. If there is going to be a good rise in the GDP eventually the taxations done would increase.

The rise in the direct taxes were 1.7% in 2005-06 and it hiked to 2.6% in the years 2007-08 wherein it declined to 0.5-0.8% in the past two years indicating how taxations are almost dodged..

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