India Rules Out New Tax Amnesty

March 4, 2013 Taxation in India

Palaniappan ChidambaramNEW DELHI – There will be no tax amnesty in India in the near future, as the country continues to advance the use of technology for collecting, administrating and analyzing national tax affairs.

In a press interview on March 3rd the Finance Minister of India P. Chidambaram revealed that the national government has no intentions of offering a tax amnesty to evaders in the near future, warning that tax authorities have already collected significant amounts of new data on tax evaders and will track down individuals who have major discrepancies in their tax returns.

The Minister said that there is currently no legitimate reason for the government to launch an amnesty to tax evaders, as tax authorities will now focus on preemptively stopping tax evasion and cracking down on individuals who have already chosen to evade their tax obligations.

The increase in the amount and quality of data held by tax authorities has been attributed to advances in the national tax filing system, with almost all taxpayers now filing their income taxes through online facilities.

The Finance Minister expanded on the effectiveness of the online system, saying that “…we have the central process cell in Bangalore that processes all income-tax returns using the most advanced software… so, if the information we have from other sources is not matched with the information from I-T returns, that will be thrown up”.

He added that in the last few month the tax authorities have already used their improved databases to contact more than 35 000 individuals who appear to have evaded part of their taxes, and he promised that even more people would be contacted and investigated in the near future.

Photo by World Economic Forum