Sitharaman said the direct tax collection target--Rs 13.35 lakh crore—set in the 2019-20 Budget was achievable.
Finance Minister Nirmala Sitharaman on July 24 asked the three wings of the revenue department—income tax, Enforcement Directorate and the Directorate of Revenue Intelligence—to work closely for better tax administration.
"If only these three (wings) shared the information about an assessee, you would have no businesses but to send an electronic claim, money is going to reach you. The whole business is about trust, with the person who is paying the tax, who is helping build the country, and you are facilitating the process. It should strictly be as simple as that," Sitharaman said at an event celebrating Income Tax Day.
Sitharaman said the direct tax collection target — Rs 13.35 lakh crore — set in the 2019-20 Budget was achievable. "We have given a very easy target. If in the last five years, you could double, what we have given you this one year is nothing at all. So, somewhere between Rs 11.8 lakh crore to slightly over Rs 13 lakh crore, which is no big deal at all. You have not been given a big target," the minister, who presented her first Budget on July 5, said.
Sitharaman asked tax officials to be firm with tax evaders, but act as facilitators for honest tax payers, as she stressed on the need to expand the tax base.
"...Those gaming the system are the ones you have to keep a watch on... data mining, big data usage are all instruments in your hand to understand where the wrong doing is happening and I am with you if you are firm on those people. I am fully with you if you are really firm on gaming," she said.
She indulged in a bit of wordplay to drive home the point. "If avoidance and evasion are two things in your mind, 'a' and 'e', of the five vowels,... then the other three letters comes into play— 'i', 'o', 'u'. No avoidance and evasion, then you owe the assessee a good service, facilitation," she said.
Explaining the rationale behind increasing the tax for super-rich, the minister said the tax was not a punishment, but was collected with the intent that those with high earnings could contribute more towards nation building.
"…We are not here to bring in something which is going to be too much on your shoulder, but yes we need that money ... would you help us to redistribute some (higher earning) for those who are less fortunate. So if that broader spirit is understood, the income-tax officers will not be looked at as: 'Oh my God, I don't want anybody from the department come near me'.”
In 2019-20 Budget, the minister increased to 25 percent the surcharge on income between Rs 2 crore and Rs 5 crore and to 37 percent on income above Rs 5 crore.
The increase works to an the effective rate of 39 percent for the Rs 2-5 crore income slab and 42.7 percent for those earning more than Rs 5 crore a year.
Sitharaman asked tax officials to be sensitive in dealing with cases of tax evasion. "If the three departments among yourself share the information, you would be better enabled to become facilitator of taxpayer. I wouldn't think it is impossible to maintain the sensitivity... So the larger message of what the Prime Minister feels that we should be seen as facilitator, we want the income (tax) but we should clearly not be in an overdrive," she said.
