Centre to keep tabs on tax evaders in film biz
Launches Project Insight to strengthen a non-intrusive information-driven approach for tax compliance; Will collect data from various sources including social media, to prepare profiles of taxpayers
image for illustrative purpose
Since people from other professions, including crime syndicates, diversify and put in their money in the entertainment sector, the I-T officials also keep an eye on such investors
New Delhi: The centre government is gearing up to update its mechanism to curb tax evasion in the entertainment sector, including the film industry and sports. The Income-Tax Department (I-T) has implemented the non-filer monitoring system (NMS) to identify the persons and entities, who make high-value financial transactions, but don't file their returns, officials told Bizz Buzz.
The I-T Department has taken several steps to tighten the screws on tax evaders in this fast-growing sector. It has launched Project Insight to strengthen a non-intrusive information-driven approach for tax compliance. Data are collected from various sources, including social media, to prepare profiles of taxpayers.
Information regarding high-value financial transactions is received from banks and financial institutions. For this purpose, Form 26AS has been introduced.
Further, the scope of tax deducted at source (TDS) and tax collected at source (TCS) has been expanded. It now also includes large-scale cash withdrawals, foreign remittances, purchase of luxury cars, sale of goods, acquisition of immovable property, etc. The I-T Department has also signed memorandums of understanding (MoUs) with the Ministry of Micro, Small and Medium Enterprises (MSME), the Central Board of Indirect Taxes & Customs (CBITC), and the market regulation Securities & Exchange Board of India (Sebi) for cross-seeding of information and inter-agency cooperation. This, officials said, will help identify tax loopholes, widen the tax net, and prevent revenue leakages.
The IT Department also formulates region- and segment-specific strategies to find out potential non-filers. Since people from other professions, including crime syndicates, diversify and put in money in the entertainment sector, the I-T officials also keep an eye on such investors.
Efforts have also been made to minimize the incidence of cash transfers. In 2019, TDS was imposed at two per cent on cash withdrawals from banks and Post Offices worth Rs1 crore. The next year, the threshold was brought down to Rs20 lakh. For the non-filers, the levy is five per cent for Rs 1crore.
The ITD has also allotted separate codes in the Income-Tax return forms. For the purpose of efficient correlation between related assessee records and for effective cross-verification of information pertaining to assessments between personalities of film and television industry, the I-T Department has constituted separate assessing units, officials said.
