![CBDT Starts Central Action Plan 2024-25 to Stop Tax Evasion](https://blog.saginfotech.com/wp-content/uploads/2024/08/cbdt-starts-central-action-plan-2024-25-to-stop-tax-evasion.jpg)
In a recent development, the Central Board of Direct Taxes (CBDT) has issued a directive to the Income Tax department, underscoring the imperative need for “non-intrusive” monitoring of widespread cash transactions in sectors such as luxury brand sales, hotels, hospitals, and IVF clinics.
This directive forms a pivotal component of the CBDT’s Central Action Plan for the fiscal year 2024-25, aimed at eradicating tax evasion and enhancing compliance within industries characterized by high volumes of cash transactions.
Pay Attention to High-Cash Industries
The CBDT has listed specific business domains where cash transactions exceeding Rs. 2 lakh are prevalent. Notable sectors encompassed within this category include luxury retailers, hotels, banquet halls, IVF clinics, hospitals, designer clothing outlets, and NRI quota medical college seats.
Requirement for Non-Intrusive Verification
Underlining the significance of conducting verification exercises in a non-intrusive manner, the CBDT advocates for ensuring compliance without unduly disrupting legitimate business operations. The Board stresses the necessity of scrutinizing high-value consumption expenses in correlation with taxpayer information to specify potential leakage of tax evasion.
Raised Obligation Requirements
Expressing concern over the substantial escalation in arrear demands, which surged from Rs. 24.5 lakh crore in April 2023 to Rs. 43 lakh crore in April 2024, the CBDT has initiated actions to redress this mounting concern. Specialized teams, spearheaded by Principal Commissioners, have been tasked with prioritizing the recovery of tax arrears from the top 5000 cases.
Utilizing Advance Technology Like Data Analytics
In a bid to improve tax compliance and expand the tax base by targeting non-compliant entities and individuals whose financial transactions misalign with their income tax filings, the CBDT plans to leverage some advanced technology extensively such as data analytics.
Conclusion: As part of its ambitious action plan for 2024-25, the CBDT is heading towards stringent yet non-intrusive measures to tackle the issue of underreported cash transactions within critical sectors. By harnessing the power of data analytics and mobilizing specialized recovery teams, the Board aims to enhance tax compliance and alleviate the mounting backlog of arrear demands effectively.