Minister calls for simple tax structure to promote greater tax compliance

The honest tax payers will pay taxes howsoever it is difficult to comply. It has never been a case of the tax evader that since the tax compliance is difficult, they have chosen not to pay taxes. Taxation structure in our country has been policy based and more of socialist, and therefore, there cannot be a simplified tax structure.

The basic reason for tax evasion is
1. poor enforcement of existing laws
2. corruption at various levels
3. no fear of law
4. greed

It is something like, the ticket booking in railways is made so simple, that you can even book your ticket from anywhere, and everywhere. Even though the ticketless travellers are on the rise. Rather than simplfied tax structure, a strict enforcement of laws and punishing the tax evaders, and also the corrupt officials who are had in glove with such evaders, would definitely bring some change in tax collection.

Recently, there were some arrests made in service tax. immediately, there were a lot of people who have started paying service tax voluntarily, and taking registrations.

Fear of law has to be inculcated in the minds of people. There may be some genuine people who need some help in understanding the provisions. The sevottam scheme started by the revenue departments, needs to be converted as helplines, working for more than 8 hrs a day, everyday.

- r. subramanya

Subramanya Rayaprol 23/07/2014

 

Interesting view from Mr. Subramanya Rayaprol. I hold the opposite view. By introducing ridiculous rules and laws (such as the Reverse Charge Mechanism in Service Tax), the govt. merely acts as an enabler of corruption.

As a conscientious tax payer, I paid all my taxes under the RCM. However the audit team as usual had it's usual 'sky-high' demand. On not being satisfied, they merely made an audit para demanding tax from 2008 (against items brought under RCM in July 2012!).

Who has to run around to set it right? If I am to pay illegal demands in anycase, I might as well defraud the exchequer and draw some benefit for myself, is it not?

Simplified regime implies that there can be no doubt in either the assessee's mind or the collector's as to the taxability of a particular item. And the tax payer is not punished for being conscientious. The reverse charge mechanism is an example of how the govt. is unable to collect from a bunch of tax evaders and hence transfers the burden to people it knows will pay - both to the exchequer and the collector.

Fear of law needs to be inculcated in the minds of the people of the various tax departments. While I cannot bring myself to agree with most of the AAP's views, I do think that taxpayers should start an association with focus on entrapping tax officials in the their acts of collection of monthly hafta and audit hafta et. al. As I see it, there is no hope otherwise of there being any respect for an honest taxpayer in this country.

Deepak Challam 23/07/2014