India already has 7.5 million new tax filers, but it’s aiming for 12.5 million by the end of this financial year

  • India’s Central Board of Direct Taxes (CBDT) wants 12.5 million fresh tax filers under its umbrella by the end of FY19.
  • More than bringing new ‘tax payers’ into the system, it’s about bringing new ‘tax filers’ under the purview of the Income Tax Department (ITD) so that individual incomes are disclosed.
  • The biggest ask is from the states of Punjab, Haryana, Himachal Pradesh and Jammu & Kashmir who have been asked to get 1.2 million new tax filers into the system before closing.
Over 7.5 million new tax filers have emerged in India for the current financial year so far, but country’s Income Tax Department (ITD) wants to break the previous year’s record of 10.6 million. In order to so, the Central Board of Direct Taxes (CBDT) has issued directives to widen the tax base further with the target of bringing 12.5 million fresh tax filers under its purview.

ITD officials believe that the reason for such great numbers is the policies and enforcement measures undertaken to keep a check on the tax evasion. In its Central Action Plan (CAP), the ITD reiterates that awareness seminars and outreach programmes should be conducted to promote voluntary compliance, especially when it comes to Tier 2 and Tier 3 cities.

Are you a new taxpayer or a new tax filer?

Just because you file an income tax return, doesn’t necessarily mean that you’re a new taxpayer. A person can file legitimate returns, but still not come into the taxable bracket if your income is below the minimum threshold.

So, in order to be a new taxpayer, not only do you have to file your returns but your income also has be taxable.

But, in this case, the ITD is only looking for new tax filers, regardless of their salaries. Because once an individual becomes a part of the ITD’s database, it’s unlikely that their income will remain anonymous.

The CAP is published by the CBDT annually acting as a vision document describing the future state and prospects for the ITD.

Rather than an arbitrary number left to linger on its own, the CBDT has specified targets for states across the country. Punjab, Haryana, Himachal Pradesh and Jammu & Kashmir have the highest target of getting 1.2 million new tax filers. The ITD says this target has been set taking the increase in economic activities into consideration.

Pune and Tamil Nadu region are supposed to get 1.1 million and 1 million new tax filers, respectively. The Andhra Pradesh and Telangana regions have to get 1 million new filers while Gujarat, Karnataka and Goa regions follow the tally apart from 12 other I-T regions in the country.
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