Press Information Bureau

Government of India

Ministry of Finance

10-December, 2012  17:42 IST

On August 6, 2012, the Finance Minister Shri P. Chidambaram made a statement on the policy of the Government regarding taxation and tax administration. He emphasized that clarity in tax laws, a stable tax regime, a non-adversarial tax administration, a fair mechanism for dispute resolution, and an independent judiciary will provide great assurance to investors. This message has been repeated on several occasions since then.

December 15 is an important day on the calendar of the Central Board of Direct Taxes (CBDT). It is the date on which the third installment of advance tax for corporates and the second installment for all other assesses (including individuals, HUF etc) is due.

In Assessment Year 2012-13, only 14,62,488 assessees (salaried persons, HUF, professionals, firms, companies and transporters & retainers) have filed their returns disclosing a taxable income of over Rs. 10 lakhs. Any fair minded person will agree that this is a gross under-statement.

We know that –

• 16,00,746 persons made payments of Rs. 2 lakhs or more against their credit cards; • 11,91,037 persons decided to purchase or sell house property worth Rs. 30 lakhs or more;

• 52,42,114 persons acquired mutual funds of Rs. 2 lakh or more; bonds or debentures of Rs. 5 lakhs or more; shares issued by a company of Rs.1 lakh or more; bonds issued by RBI of Rs. 5 lakh or more;

• 33,83,276 persons made cash deposits aggregating Rs. 10 lakh or more in the savings bank account.

Government would urge all asessees to disclose their true income. There is no advantage in suppressing the true income or avoiding paying income tax that is due because, sooner than later, the information available with the Income Tax Department will lead the department to the doors of such persons. For assesses who have not yet paid the correct advance tax, there is an opportunity to rectify the mistake and pay the advance tax by December 15, 2012. Government seeks the cooperation of all citizens in this regard.

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DSM/RS/ka

Advance tax: taxpayers urged to disclose true income and pay outstanding instalments to avoid enforcement action later. The statement urges taxpayers to disclose true income and meet advance tax obligations before the instalment due date, citing third party data on card payments, property transactions, investments and large cash deposits that reveal under reporting. It offers an opportunity to rectify underpaid advance tax and warns that departmental information matching will identify discrepancies, urging voluntary compliance to avoid subsequent enforcement.