Govt for stable tax regime: FM

Says govt is fully committed to provide best possible facilities to taxpayers for better tax compliance and revenue augmentation

Finance Minister P Chidambaram today said the government would provide a stable tax regime which is in the interest of both the taxpayers as well as tax collectors.

Speaking at the 5th Meeting of Consultative Committee attached to his ministry, he said the government is fully committed to provide best possible facilities to the taxpayers for better tax compliance and revenue augmentation.

The Finance Minister stressed the need for systematic changes including strengthening of the tax information system for better collection of taxes. He said that at present 3.5 crore people are filing income tax returns and only 14.6 lakh have declared income of Rs 10 lakh and above for tax purposes which is not realistic.

 

He said India has moderate rate of income tax as compared to various developed countries as the peak rate of taxation is 30% at present. Therefore, there is lot of scope for better tax compliance and tax collections, he added.

The Finance Minister also informed that about 50% taxpayers are filing their return through e-mode, but there is a need for more and more taxpayers to electronically file their return as it well help in expediting tax processing and refund process.

The Members of the Consultative Committee present in the meeting suggested various measures for improving relationship with taxpayers. Some members suggested that efforts be made to keep the tax rates low for better compliance. Some suggested that interest on refund may be paid at least at the bank rate of interest, while some proposed widening of tax base for higher revenue collections.

Members also said that tax facilitation centres be opened in rural areas which in turn will help in increased revenue generation. Tax awareness campaign for payment of due taxes on time may also be undertaken in the local language.