PM Narendra Modi's demonetisation move pays off as income tax net widens
Mail Today Bureau August 8, 2017
The number of income tax returns filed for 2016-17 jumped by 25 per cent to 2.83 crore, as more individuals have come into the tax net after the shock demonetization and "operation clean money'' launched in its wake, official figures released on Monday show.
The total number of returns filed as on August 5 stands at around 2.83 crore up from 2.27 crore filed during the corresponding period of 2016-17. This was an increase of 24.7 per cent compared to growth rate of 9.9 per cent in the previous year.
"As a result of demonetisation and Operation Clean Money, there is a substantial increase in the number of Income Tax Returns (ITRs) filed," an official statement said.
The last date for filing of income tax returns by individuals and HUFs, who need not get their accounts audited, was August 5. The finance ministry said that the number of ITRs filed showed that a substantial number of new tax payers have been brought into the tax net after demonetisation.
The effect of demonetisation is also clearly visible in the growth in direct tax collections, the statement said. Advance tax collections of personal income tax (other than Corporate Tax) as on August 5 showed a growth of about 42 per cent over the corresponding period in 2016-17.
Personal Income Tax under Self Assessment Tax (SAT) grew at 34.25 per cent over the corresponding period in 2016-17. The above figures amply demonstrate the positive results of the government's commitment to fight the menace of black money, the statement added.
The Central Board of Direct Taxes (CBDT), which is the apex policy making body of the I-T department, is committed in its resolve to eradicate tax evacorsion in a non-intrusive manner and widening of the tax base.
To fight the menace of black money, the government had on November 8, 2016, scrapped old 500 and 1000 rupee notes and asked holders of such notes to deposit in bank accounts.
The I-T department had then launched operation clean money to crack down on unaccounted money deposited in bank accounts post-demonetisation. Various estimates suggested that close to Rs 15 lakh crore of the Rs 15.44 lakh crore in high value notes that were scrapped ended up with banks.
However, the RBI is still arriving at the final figure. Finance Minister Arun Jaitley had made it clear that "black money does not change its colour merely because it is deposited in banks. On the contrary, it loses its anonymity and can now be identified with its owner," the finance minister had remarked.
The I-T department had obtained information from banks on all deposits in which Rs 2 lakh or more was deposited during the 50-day demonetization window and had cracked down in these cases.