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Topic : Trends In Banking
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More tax cuts for those without permanent account number: Is this a right decision?

Created by : Swati Raut, Product Manager, Aviva  | 01 21 2010 10:15:52 +0000
Industry : BankingFunctional Area : India(Markets)
Keywords : pan 20% more tax 1 april 2010
Activity:  243 views;  last activity : 07 06 2010 20:18:09 +0000

In today's news, I came across this article that the Central Board of Direct Tax has made a law that from April 1, those who don't have permanent account number will have to pay 20% more tax. Their tax at source will be 20% more at the highest level or the highest prescribed rate for the category of income, whichever is higher.

The law will also apply to all non-residents in respect of payments and remittances liable to tax deduction at source. According to the new guidelines, assessing officer will not issue certificate for deduction at lower rate or zero-deduction unless an application bears the permanent account number.

So users, what do you think. Is this decision right?

  
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Central Board of Direct Taxes issued a circular in this matter, as per that tax is to be deducted at source at maximum marginal rate of tax if the deductee do not furnish Permanent Account Number, this is applicable from 1st April, 2010. Position applicable right now is that if PAN is not availed by the deductee it is sufficient to furnish a declaration in the prescribed form so that the deductor can deduct the tax at applicable rate. By this suppose if deductee furnishes wrong information, the department cannot trace the deductee to recover additional tax if any to be recovered. By the introduction of this proceedure the Government revenue get protevted. It is a wecome moove from the side of the department.
By RAMANATHA PRABHU N, Chartered Accountant  01 22 2010 11:48:35 +0000
 
Top Argument
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What's the accountability for this action Ma'am? Just cutting the Tax... The governing ppl says it's for a good cause, let them convince citizens- the taxpayers- their money is not getting to the wrong hands...
By Mahesh R Nair, Associate/Sr. Associate -(Technical)  01 22 2010 11:11:47 +0000
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Yes ... conditions apply.

Wide publicity should be given to this new rule. I.T. Deptt should arrange to issue PAN cards to all eligible and should open facility counters for issue of cards.

 

-------------   Just few minutes .. I was visiting TooStep to a question : How India may curb black money. Some posted  views that Govt. in doing nothing. Now I come accross this question : should PAN be made a condition for deducting TDS at lower rate ?

Who is eligible for TDS : who earns Rs.10,000=00 or more as Interest p.a. from his /her investments. May this section be a slam dweller or a BPL member or a daily wage earner ?

Is not this step by Govt. was long awited ? Are they not trying to identify the tax evaders ? Are they not encouraging people to have a PAN card ? May ( then ) not we may go forward for the "Unique Identification Number" ( we often speak for advanced countries ) ?

Better late than never. Govt is late to introduce such law. The investors' section is not just poor. To save from higher TDS, they should hurry to the nearest centre ( generally a Xerox house, a PCO booth owner or a small time MF seller or some agents of Bank/MF/LIC etc. ) to have a PAN card.

 


By ASOKE KUSARI, Domestic Private Banking-Executive/Manager, A large leading PSU Bank - India  | 04 02 2010 03:36:17 +0000
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I agree in totality...
By Prassan Kumar Sharma, AVP, Nirmal Bang Securities  | 01 23 2010 20:48:54 +0000
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Its a right move by the Government of India. Hope it will bring in more transparency in the Taxation process.
By John D Nevin, Manager - Finance & Administration,StreetEdge Investments  | 01 22 2010 17:33:59 +0000
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Good decision, it is a good step taken by the Government. Hopefully, it will keep a check on tax evaders. This decision is a very good step to to take action against those who don't make a PAN account just to avoid tax. This new decision will be a very good answer to them.
By Swati Raut, Product Manager, Aviva  | 01 21 2010 10:29:22 +0000
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no, this is not a right move because there are millions of illiterate people who may be penalised with this move.instead the govt. should find ways to curb corruption and punish and penalise those offering as well as accepting bribe. it should also frame penalties for those evading tax
By KETKI VAIRAGARE, Branch Manager/Regional Manager, Bank of India  | 03 27 2010 09:08:57 +0000
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it is not a right decision . in this country  black money is there first government

trace it out. many big peopple firms not paying tax properly. first create

awareness and responsiblity for people.   
By cmsrinivas , SalesManager-autoloans NBFC  | 01 22 2010 13:41:06 +0000
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As employees are getting good salaries, but inflation rate is so high, every thing needed for day to day life is becoming costlier, basic cost of leaving is high, people have liabilities towards their families, house and various loans etc. The upper limit of Tax exception should be increased. Maximum part of salary goes in paying tax. Government should think over this issue as the cost of leaving is rising. I am not against taxation but my view is, try to save your money in such a way that you pay only half tax. If we try to save our money from tax then these politicians will come out with different type of tax and we all have to re and re think on it. So make sure that we don't give any chance to these politicians to increase tax by different means. This new decision by the planning commission will be set up by Govt to distribute that amount into Politician's Pockets.
By Niranjan Meena, Actuary Manager, LIC  | 01 21 2010 10:24:57 +0000
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