Govt plans direct tax immunity scheme move may earn Rs 50,000cr: Report
In an attempt to boost direct tax revenues, the government may allow assessees to revise declared income for the previous five-to-six years without penalty or prosecution, Business Standard reported.
The move, suggested by a direct tax taskforce, will permit individuals to declare additional income without fear of coming under the radar of tax authorities.
The direct tax immunity scheme will help increase revenue collection from direct taxes and improve compliance.
The government expects to earn at least Rs 50,000 crore in the first year alone after easing the norms, the report said.
An announcement to the same is expected during its Budget presentation on February 1, the report added.
“People who want to declare more income from the previous year do not do so because the moment they do so, they are taken up for scrutiny, investigation and prosecution, and penalties are imposed upon them,” the article quotes an official as saying.
“Recommendations made by the direct tax panel are being taken seriously,” the official added.
The direct tax taskforce that recommended the proposal is headed by Akhilesh Ranjan a former member of the Central Board of Direct Taxes (CBDT).
As of December 15, 2019, direct tax collection grew 0.7 percent in FY20 as against the Budgeted target of 17.3 percent.