I-T dept sends another 35,000 letters to high spenders to pay tax

Another 35,000 letters to be sent soon

Bolstered by Rs 600 crore tax paid by high spenders, the Income Tax Department has sent another 35,000 letters to assesses who have not filed their returns. Another lot to 35,000 people will be sent shortly, the finance ministry said.

The department had earlier sent 1.05 lakh letters to tax assesses to enquire from them whether they have filed returns. Pursuant to the letters, taxes of more than Rs 600 crore has been paid as self assessment tax and advance tax by the target segment in last three months, the ministry said in a statement here.

The department has set up a compliance management cell to ensure follow-up action and track return filing and tax payment of the target segment.

Letters are the first stage of reminding tax payers that they have not filed returns, after which notices are sent.

The tax assesses are identified from third party information, called annual information returns (AIRs), about spending of these individuals. AIRs are basically information given by banks and others to income tax department about spending above a threshold by any individual to the tax department. The department then matches these spending with the income disclosed by the assesses to find out if true income is disclosed.

Besides, information from the Cash Transaction Reports of FIU-Ind was also used. This data analysis has identified target segment of 12,19,832 non-filers linked to more than 4.7 crore information records. Rule based algorithms were used to identify high priority cases for follow-up and monitoring.

This data analysis initiative has also helped in defining the scope and requirements of a comprehensive Data Warehouse and Business Intelligence (DW & BI) Project of the Income Tax Department. The DW&BI Project will develop a comprehensive integrated platform for effective utilisation of available and accessible information to promote voluntary compliance, deter non-compliance and impart confidence that all eligible persons pay appropriate tax. The project will integrate enterprise data warehouse, data mining, web mining, predictive modelling, data exchange, master data management, centralised processing, compliance risk management and case analysis capabilities.

The government has targeted to raise income tax collections by 20% to Rs 2.48 lakh crore in 2013-14 from Rs 2.06 lakh crore in the revised estimate for 2012-13.