Govt.'s huge challenge to recover Rs 8 lakh crores in Tax arrears
Fiscal deficit a worry
The Union Finance ministry is working overtime to recover Income-Tax arrears running into nearly Rs 8 lakh crores to achieve its targets before March 31, 2023. Though the total arrears due are to the tune of Rs 19 lakh crores. But the government has set a reasonable target to recover a minimum of 40% of this amount.
Since the Modi government has fixed the target of spending Rs 10 lakh crores towards infrastructure projects across the country during the next fiscal, the Finance ministry has been asked to recover arrears at a faster pace. The past record suggests that It has been able to recover only 10% of its arrears. The government is now targeting to take this amount to 40%. It is for this very purpose that nearly 100 joint commissioner rank officials will be deployed to dispose of appeals filed by the tax-payers and also recover from those where a huge amount is due.
The tax arrears are piling up because of litigation, liquidation of companies, untraceable taxpayers, and a mismatch in tax deduction at source. There are also cases stayed by courts or tribunals. The IT officials have been directed to carry out recovery surveys in a large number in suitable cases after due diligence.
The dichotomy is that the IT department is also flooded with appeals where tax-payers want it to refund Rs 14.19 lakh crores until 2021-22. As many as 5,98,448 were filed during the past five years. Of this 4,40,153 appeals have been disposed of during the five year period. But it shows that more than 2 lakh appeals are still pending with the Commissioner (Appeals). The government is seriously contemplating settling the issue through negotiations. But IT officials are unwilling as they may be hounded by probe agencies for giving favours to taxpayers.
