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Vice President of India M Venkaiah Naidu said on Tuesday that every citizen must consider it as his sacred duty to pay taxes as development and welfare measures would suffer if governments do not get adequate revenues. He was addressing the National Seminar on Contemporary Challenges and Issues in Finance, Marketing and Taxation in Hyderabad today. Vice President said that while tax evasion has to be dealt with sternly, it should be ensured that there is no unnecessary harassment of the taxpayers by overzealous officials. Transparency in governance will ensure accountability and also improve remittances to the government, he added.Venkaiah Naidu said that with introduction of GST, the biggest ever tax reform taken since Independence, India is finally ‘one-country, one-market’. He further said that this reform has changed the face of the indirect tax regime in the country as it imposes one tax instead of several taxes by various State Governments and the Union Government. It has made compliance easy for businesses and traders and demonstrated the victory of bipartisanship in the democratic and federal set-up of India, he added.
India’s tax-to-GDP ratio is 16.6 percent in FY2017, which compares with 26.0 percent in the USA, 20.1 per cent in China, and 34.3 percent in OECD countries. India needs to significantly ramp up its tax-to-GDP ratio to fund a modern 21st century government which can offer basic public goods and social security to its citizens. Direct tax collected in FY2018YTD has grown at 18.2 percent. This increase in collection has been driven by increase in compliances with the number of taxpayers increasing for both direct and indirect taxes. 5.9 million taxpayers have registered for GST and 28.2 million people filed their income-tax returns for FY2017.
The tax department has already discussed with field officers on the shift to a jurisdiction-free assessment and the suggestions received from the field have been incorporated in the draft Finance Bill, 2018, by the Central Board of Direct Taxes (CBDT), the official said. According to officials, functional specialisation is also expected to be a key feature of the new system, wherein a tax official will not handle all stages of assessment. The roles of tax officials are likely to be split in different functions of assessment, verification, tax demand, recovery and orders.
The income tax department is also working towards expanding its services under its online feedback facility. The income tax department, had launched a live chat service in July last year that has already clocked 8,424 users during July 10-December 31, finance ministry data showed. At present, the department answers taxpayers’ queries related to income tax e-filing, TDS and taxpayer services through its live chat window. The questions posed by individual taxpayers are answered by a team of experts from the tax department, as well as independent tax practitioners via a live chat window on the department’s portal.