Prime Minister Narendra Modi-led government is planning to introduce a new warehouse of virtual information which will not only collect information from traditional sources like banks but also from social media sites.
Are you a social media addict? Do you like to post an image of your food on Instagram before eating it? Or, is a Facebook post must whenever you buy a new car or any tech gadget? Well, then you may have to control your social media activities from next month otherwise it might lead to an Income-Tax department raid at your place. Wondering how is that possible? According to a report by Bloomberg, Prime Minister Narendra Modi-led government is planning to introduce a new warehouse of virtual information which will not only collect information from traditional sources like banks but also from social media sites. This new system which will be called ‘Project Insight’ will match residents’ spending patterns with income declarations, as per the report.
‘Project Insight’ which will complement the world’s largest biometric identity database has been built over a period of seven years at a cost of about 10 billion rupees ($156 million). This will be India’s most ambitious tax overhaul policy till date and the best time to introduce it could be right after the implementation of the GST. The reason why the government was forced to introduce this policy is that even though India is the world’s fastest growing economy, revenues aren’t keeping pace, bloating Modi’s budget deficit and triggering anxiety about over-zealous tax sleuths.
Interestingly, India won’t be the first country to have a system like this. Countries including Belgium, Canada and Australia are already using big data to unearth tax evasion that may have gone undetected without technology. Project Insight is more similar to UK’s Connect which was built at an estimated cost of 100 million pounds. It is believed to have prevented a loss of 4.1 billion pounds ($5.4 billion) in revenue since inception in 2010.
Last year, the government had contracted L&T Infotech Ltd. — an arm of India’s largest engineering conglomerate Larsen & Toubro Ltd. — to help build the network and boost voluntary compliance. The chief executive officer and managing director of L&T Infotech, Sanjay Jalona was quoted saying in the report that this is a long term project, without defining a time frame.