The tax defaulters will be "hit hard" if they failed to pay their dues, Revenue Secretary Sumit Bose today said.
The Finance Minister, P Chidambaram, in the Budget introduced the Voluntary Compliance Encouragement Scheme (VCES) to motivate service tax assesses who had not filed returns or stopped filing returns, and not paid service tax dues from October 2007 to March 31, 2012.
"There is no target for VCES but the department has so far received more than 1,000 applications. The assessees have been given the option of paying the dues in instalments by December 2013," he said here.
Last year, the Government collected Rs 1,24,000 crore in service tax and this fiscal the target has been set at Rs 1,81,000 crore, Bose told reporters.
The Revenue Secretary said the Centre has undertaken an exercise to enlighten the tax assessees on VCES.
As part of this exercise, Bose interacted with a group of members of the business community and trade organisations, chartered accountants and manufacturing houses here.
Bose heard their grievances and asked them to send representations, and if needed, meet him personally.
Under the scheme, the defaulters will be required to make a declaration of all pending service tax dues from October 1 2007 to December 31, 2012 and pay at least 50 per cent of that before December 31, 2013. The remaining 50 per cent is to be paid by June 30, 2014 without interest.
Payment after that will attract interest, Bose said.
The Secretary had earlier said failure to pay service tax will attract penal action which could include arrest, prosecution and property attachment.