Your pending income tax refund could be processed much faster with the income tax department planning to expedite the process and clear as many claims as possible in the current fiscal. “We want to settle most pending claims from the past years by March 2011, so that we can start the new fiscal on a relatively cleaner slate,” an income tax official said.
The Central Board of Direct Taxes (CBDT) — the nodal office for the income tax department — has decided to settle all income tax refunds pertaining till 2009-10 by the end of the current fiscal. “With the Central Processing Centre operational, we will be able to process all claims for electronically filed returns for 2009-10 by March next year. However, settling refunds for manual returns could take some more time,” the official said.
The CBDT has also hiked its target for processing refunds to Rs 70,000 crore in this fiscal as against Rs 58,046 crore in 2009-10. Income tax refunds for 2008-09 stood at Rs 41,445 crore while in 2007-08, they totaled Rs 40,965 crore.
Already, income tax refunds have picked up by 19.5 per cent till December 15 to Rs 44,000 crore as against Rs 37,400 crore in the corresponding period a year ago.
However, the move could put some pressure on the exchequer which is hoping for some additional tax revenue as it tries to finance the burgeoning fiscal deficit of 5.5 per cent of the GDP in 2010-11. “With the increased target for refunds and the current growth rate in tax collections, we may not be able to exceed the Budget estimate for direct taxes,” the official added.
The Centre has pegged the direct tax collection target at Rs 4,30,000 crore for the fiscal. Net direct tax collections grew by 17.85 percent to Rs 2,16,628 crore between April and November 2010.