1 min read.Updated: 22 Oct 2018, 11:41 PM ISTRemya Nair
More than 140,000 taxpayers, including companies, declared income of more than ₹1 crore in their tax returns for 2016-17, a rise of over 60% from 2013-14
New Delhi: The number of taxpayers declaring income of more than ₹ 1 crore has increased sharply in the past three years, a trend the government attributes to better compliance with tax rules and stricter enforcement. More than 140,000 taxpayers, including companies, declared income of more than ₹ 1 crore in their tax returns for 2016-17, a rise of over 60% from 2013-14, according to data released by the income tax department on Monday. Of these, individual taxpayers reporting an income of more than ₹ 1 crore increased by 68% to 81,344 in these three years.
Steps such as demonetisation, linkage of Aadhaar and permanent account number, restrictions on cash transactions and the implementation of the goods and services tax (GST) have helped create a widespread audit trail that has helped the tax department bring more people into the tax net.
GST was, however, implemented only in July 2017 and the improvement in compliance in the year ended 31 March 2017 cannot be attributed to this tax reform.
Data released by the tax department also shows better compliance among salaried taxpayers vis-à-vis non-salaried taxpayers. The number of salaried taxpayers rose 37% to 23.3 million in the three years ended 2016-17. In contrast, the number of non-salaried taxpayers went up by 19% to 23.3 million.
S.P. Singh, partner at Deloitte India, said the rise in the number of taxpayers in India since 2014 could be attributed to demonetisation, increase in the use of information being collected digitally, movement towards digital assessment, decrease in the number of cases being picked up for scrutiny and ease of getting refunds. “The last two have reduced fear of the tax department among these sections of taxpayers," he said.
Rakesh Nangia, managing partner at tax consultant Nangia Advisors LLP, said the significant increase in the number of large taxpayers (with over ₹ 1 crore income) is an indicator that the government’s efforts to broaden the tax base and bring transactions into the tax net are showing positive results. “It also shows the reduction in extent of unreported cash economy," he said.
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Never miss a story! Stay connected and informed with Mint.
our App Now!!