This refers to the news report in Economic Times dated 30/4/16 that only ten lakh people are declaring income above Rs ten lakhs. Obviously something is seriously wrong with the Income tax assessment and the number of people filing the IT returns. This is nothing but absurd. Even a lay man with even below average common sense cannot take this figure as correct as he knows that in his own surroundings wherever he is in any metropolitan City in India that there are lakhs of people earning more than Rs ten lakhs. In IT Companies alone there will be lakhs of employees earning more than Rs 10 lakhs per annum. Then what about the Central Government employees, Bank officials, professionals like Accountants, lawyers, Doctors, Consultants and specialists attached to various multinational companies, Real estate Dealers, Brokers, Traders, Commodity dealers, Persons engaged in scrap dealings, Interior decorators, Hoteliers , Merchants, Medical shops, Car service Providers, Second hand car dealers, and all sorts of middlemen operating in different areas and commodities. Herein lies the influence of black money, corruption and inefficiency in tracking the transactions and capturing them for improving the data collection and augmenting the resources of the Government. Definitely there is ample scope to augment the revenues of the Government through Direct Tax and reduce the rate of tax for lower income groups. It is time for the Income Tax Department to realise the realities of the economy and capture the information relating to the informal economy which is more or less equivalent to the formal economy.
Dr T V Gopalakrishnan
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