A large number of taxpayers have been added taking the direct tax base to nearly 8 crore from the provisional number of just over 6 crore effective taxpayers in FY16, Central Board of Direct Taxes (CBDT) chairman Sushil Chandra said on Tuesday. The widening of tax base was a result of direct tax reforms, including demonetisation. According to the I-T department, 6.26 crore people paid tax in FY16, which included those filing I-T returns as well as those where tax was deducted at source from the income of the taxpayer but the taxpayers did not file the returns. Further, underlining the reduction in discretion employed by department’s assessing officials, Chandra said the a miniscule proportion of total returns filed are picked up for scrutiny. “Of the 5.28 e-returns filed in FY17, the department only scrutinised about 2 lakh of them, which is 0.5 of the total returns,” Chandra said while addressing an industry body. On the customs duty hike in the Budget, Central Board of Excise and Customs chairperson Vanaja Sarna said the move was purely intended to encourage domestic value addition and manufacturing rather than increased revenue collection.
The government raised customs duty on 45 items, which included smartphones, LED TVs, among others. It’s expected to collect about Rs 6,000-7,000 crore from the increase in import duty along with the new health and education cess. “We have carefully picked up the items (for customs duty hike) as we have the ability to make them in domestically. This has been done for MSME primarily to allow them to come to the market,” Sarna said. She said customs duty on parts and sub-parts on finished goods attracted nil duty so that local manufacturers can make the final products locally. Allaying fears that the move could be inflationary or affect the masses, she said these items weren’t consumed by large section of the population.