Need to widen tax base to bring down tax rates: Revenue Secretary
The government is making efforts to widen the tax base on both direct and indirect taxes front to possibly bring down tax rates, revenue secretary, Mr Sumit Bose said at an ASSOCHAM event held in New Delhi today.
“We are using advertisements, technology, sending out letters and are getting encouraging results as the number of returns filed are actually showing an increase,” said Mr Bose while inaugurating a ‘Post-Budget Conference’ organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
“We had sent about one lakh letters of about 12 lakh cases of high value transactions we have come across but didn’t find evidences of tax returns being filed,” said Mr Bose. “We have seen an increase in the number of returns after we had sent out letters and we expect to able to encourage non-filers and stop-filers in service tax to come and pay their due share of taxes well before December.”
Hailing the union budget 2013-14, the top Finance Ministry official said, “Major achievement of the budget has been to contain the fiscal deficit to 5.2 per cent and it must be seen in the context of everything that happens in an economy across both central and state governments.”
“Fiscal deficit impacts growth, private industry, inflation and very importantly impacts country’s ability to take countercitrical measures when actually the economy doesn’t do well,” said Mr Bose. “We are able to give a boost to the growth only if we are able to reduce fiscal deficit and the fact that we need to reduce fiscal deficit because it also empowers us to take actions when economy doesn’t do well also needs to be recognised.”Online GST Certification Course by TaxGuru & MSME- Click here to Join
The Revenue Secretary also emphasised upon the need for growth to get taxes. “Without growth there won’t be taxes and that reiterates how industry must act as partners with tax administration agency as growth is inter-linked with taxes.”
Highlighting the issue of arrest, Mr Bose said that government doesn’t intend to use such provisions indiscriminately. “The effort is to ensure that those getting away by must pay their share of taxes and these provisions must be seen in that context.”
Earlier, while addressing the ASSOCHAM Post-Budget conference, Ms Praveen Mahajan, chairperson of the Central Board of Excise and Customs (CBEC) said that government has targeted a very modest increase in both customs and central excise and this should provide some comfort to the business and industry.
“There is a very clear realisation that taxes come largely from growth and we have to collectively work on getting back to high growth path as witnessed in the past and it is not easy particularly as the global demand is suppressed terribly,” said Ms Mahajan.
On the issue of arrest, the CBEC chief said, “The arrest will be effective only when a considerable amount i.e. Rs 50 lakh is involved and only when it has been collected as service tax but has not been paid to the government as that would practically be a breach of trust.”
She further said that CBEC would be coming up with strict guidelines and arrest would be made at the level of commissioner, so there is no likelihood of anyone coming across an unwarranted harassment.
On the issue of input tax credit which has been pending for over 1.5 years, Ms Mahajan said that she will meet the industry representatives in April and assured of being able to find a solution to it in April itself.
“The budget proposals contain additional proposals for resource mobilisation, however this do not impinge on the growth prospects of the industry,” said Dr. Poonam Kishore Saxena, chairperson of the Central Board of Direct Taxes (CBDT) while addressing the ASSOCHAM Post Budget Conference.
“It is in the interest of the department that industry grows at a higher growth level as both are partners in the growth of the nation and we need to jointly dispel any impediments in the path of India’s success,” said Dr. Saxena.