Tax department playing smart; after multi-million dollar weddings, it’s time for luxurious cars to spell out names of their tax-evading owners

After covering week-long, multi-million dollar weddings, parties and big shopping binges, the tax department of India has found a new place from where it can dig for information on tax evaders - luxury car dealerships.

As per reports, these moves have become necessary because of a long list of tax evaders that features multi-millionaire Indians. Data suggest that only six people earning over $7.4 million had filed their returns in 2012-13. This, despite the fact that there are around 2,100 ultra-wealthy Indians whose net worth exceeds $50 million.

"The people in the higher bracket are not paying the correct amount of taxes. This is a fact," revenue secretary Hasmukh Adhia told AFP of the new initiative. "We need to do something about it. We are taking a lot of enforcement action."

The rising number of luxury cars on Indian roads is an indication of the number of super rich Indians, and yet when it comes to tax-paying, it’s only a handful of people who bother about filing their right income in the returns.

However, this is not as easy as it sounds. Andrea Baldi, head of Asia Pacific for Lamborghini, says that by tracking its sales, the government would not get much benefit. "The people in India who are not declaring their tax are not the kind of people that will buy a very flashy car and drive in front of the entire city displaying their wealth."

The government however says that it is a start, and with greater transparency, a culture of shame will be brought in India, for people who evade taxes.

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