BackPaperless applications, rural camps part of bid to expand PAN coverage
Tax department launches an all-India drive to expand the number of people with PAN as it looks to widen the tax base
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New Delhi: The income-tax department is embarking on a series of steps to widen the coverage of the permanent account number, or PAN, including facilitating paperless PAN applications and setting up camps in rural areas.
On Tuesday, the tax department launched an all-India drive to expand the number of people with PAN as it looks to widen the tax base.
The tax department has so far issued around 230 million PAN cards, but only around 50 million assessees file tax returns every year.
The tax department is targeting people in rural areas who will benefit by paying lower tax deducted at source for financial transactions if they quote PAN. Those who do not quote PAN have to pay a higher tax deducted at source of 20% for many transactions, including on the interest accruing from bank deposits.
These people, who may be primarily earning agricultural income, do not need to file income-tax returns and hence do not apply for PAN.
A wider PAN base will help the tax department in implementing the budget proposal of making PAN mandatory for all cash transactions of ₹ 1 lakh or more.
“It is a good idea. Eventually, PAN will be required for all kinds of financial transactions. In rural areas, if there is a rich farmer, chances are good that he will have income from other sources as well, in addition to his agricultural income," said B.M. Singh, former chairman of the Central Board of Direct Taxes.
“But there is one glitch. How do you verify the identity of the person? There are people who have multiple PAN numbers. There is also no linkage with the death registry. There are instances of PAN cards of dead people being used. There is a need for a comprehensive approach," he added.
The department also launched its eSahyog initiative, wherein small taxpayers can interact with the department over email and save themselves a visit to the income-tax office. This online mechanism will be used in cases where there are mismatches in tax returns of taxpayers. The pilot project will start with 91,000 taxpayers, under which the assesses will be informed by SMS and email about the mismatch.
“The objective of the I-T department is to make life as easy as possible for the assessee and difficult only for those who consciously evade and avoid taxes," finance minister Arun Jaitley said at the launch.
PTI contributed to this story.
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