New Delhi: The revenue department will automate all dealings between taxpayers and the department with respect to excise and service tax from the next fiscal year.
Christened the Automation of Central Excise and Service tax (ACES), taxpayers will be able to go online to make not just excise and service tax payments, but also file returns and claim refunds. In turn, the revenue department will be able to raise tax demands online.
Besides ease of use, the automated system will help the revenue department in monitoring the lakhs of taxpayers in the country and, thereby, reduce leakages of revenue.
Each registered dealer who pays excise duty or service tax will be given a user ID and a unique password through which he can access a personalised dashboard on the department’s website, giving him the details of the total excise or service tax paid, the status of the refunds sought and the demands raised by the department. There are around 1.5 lakh registered dealers who pay excise and seven lakh registered service taxpayers.
The project is expected to be implemented in the second quarter of fiscal 2008. Operationalisation of the project is linked to the setting up of the central data warehouse, which will store all the data pertaining to customs, excise and service tax in a centralised server.
Revenue department officials said that the user acceptance tests—to test the software for ACES—were currently being conducted in 12 areas across the country. “The user tests are expected to be completed by April this year,” a department official said.
Since some dealers may not have access to computers in their offices, the department is considering setting up kiosks or service centres, which would be outsourced to private companies.
“We already have service centres in around 38 customs houses where we provide computer facilities to traders. These centres are operated by CMC Ltd, which charges Rs60 per document from the traders. We are looking at a similar model for excise and service tax,” an official said.
Another proposal that is likely to be made effective from 1 April is the mandatory e-payment of excise duties of more than Rs50 lakh per annum.
The government had, in October last year, made e-payment of service tax of more than Rs50 lakh per annum, mandatory.
Officials said that the revenue department was also considering automation of cenvat, which is the credit payable to a trader for excise duty or service tax paid on inputs or during the manufacturing stage. Automation of cenvat is being considered in the wake of increasing concerns of misuse of the credit facility by some manufacturers.
“If the entire process of claiming cenvat is automated, dealers will have to submit details of their invoices while filing their claims. This will be compared with the physical copies of the invoices submitted in their excise or service tax returns.
“Since there are close to 40 crore invoices generated every year in excise alone, the department will have to manage substantial amounts of data. Hence, the pros and cons are being examined before a decision is taken,” an official said.
Excise collections have been growing at an average of 6% this fiscal. The lower growth is being attributed to an increase in cenvat claims.