JOIN USThe apex direct tax body, Central Board of Direct Taxes (CBDT), has formed seven committees comprising senior revenue officials to come out with a draft Vision 2020 document that would delineate ways to increase tax collections in a non-intrusive manner.
The committees or working groups are meeting on a regular basis to draft the document that would focus also on monitoring cross-border transactions and inflow of capital, money laundering and exchange of information under treaty obligations, a finance ministry official said.
At present, taxmen keep a watch on such activities, but the draft Vision 2020 document would clearly specify their role to combat money laundering, tax avoidance by overseas firms and other illegal activities, he said.
The Vision 2020 document would work "to ensure growth in revenue collections, widening and deepening of tax base by following a non-intrusive, yet effective and meaningful enforcement strategy," the official said.
The CBDT held a meeting of its officials on the Vision document here last week. At the meeting, there was stress on drafting of the document as soon as possible. (MORE)
As per the plans, the income tax department would have a fully functional research unit along with a data base on legal issues that have come before higher appellate authorities.
There are seven working groups that are drafting the document, each headed by a senior bureaucrat of the revenue department.
There would be one core drafting committee on people strategy and expenditure budgeting, a group on structure and process strategy, another on technology strategy and other aspects to improve the functioning of the department.
The efforts by the Income Tax Department assumes importance as the country is likely to see a new legislation --Direct Taxes Code--from 2011-12, which would not only reduce exemptions but also the tax liability of the assessees.
As such, the clear monitoring of the assessees would assume more importance under the new tax regime that would replace the archaic 1964 Income Tax Act.
Direct tax collections constituted 6.5 per cent of the GDP in 2008-09, up from 2.8 per cent in 1995-96.