CASH DEPOSIT DISCLOSURE LIMIT TO BE INCREASED
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It is said that the tax collections should be like a bee collecting honey from a flower….the flower is hardly disturbed. Bee gets the nectar and the flower gets pollinated. Both are mutually benefited.
But many of the steps taken by the Income Tax Department seems to rigorously disturb the plant ! !
The New Income Tax Returns mandates disclosure of all Cash deposits made during the demonetization period i.e., from 09.11.2016 to 30.12.2016 (if aggregate of cash deposits during the period is more than or equal to Rs.2 lakhs). The move is intended to track high value cash deposits made during the said period and thereby detect the tax evaders.
But the limit of Rs.2.00 lakhs is too low and the same needs to be relooked and be substantially increased for many valid reasons.
It is a well-accepted convention and a natural practice that many households intend to possess liquid cash for future transactions – emergency/contingency, planned/unplanned or expected/unexpected expenditure.
Even though the amount an Individual may possess depends on his earnings, it is a natural tendency to keep a part of one’s past accumulated savings in liquid cash.
It may be either for convenience and security reasons or for Family and parent’s needs.
Retired and senior citizens, in particular, have the propensity to hoard sufficient cash than what is normally required – mainly because of the fear towards their health problems and also psychologically they feel secured because they think that they would be timely attended and rescued if liquid cash is available on hand.
It is a bitter truth that for cases not covered by Medical Insurance, the hospitals insist for spot payment at the time of admission, for emergencies and casualties happening after normal banking hours.
Demonetization has made all the common citizens suffer ; unfortunately, the rich, the influential and the corrupt people have managed to escape the suffering; this is evident from the fact that many have resorted to unethical means to exchange their cash hoardings.
Thus, the common man has suffered from Demonetization and is likely to suffer from the aftermath of the Disclosure of cash deposits.
The Department has already collected response from the tax payers on cash deposits made during the Demonetization period and has escalated its Investigation. This is based on the information collected by it – through its own sources and also on the basis of the response given by the tax payers.
The Income Tax Department boasts of a very highly efficient data mining to detect black money hoarders and claims that it has around 60,000 people under its scanners. Then why does it require voluntary disclosure by all the tax payers? Why is it not channelizing all its efforts to detect the tax evaders and punish them ? In fact, the matter does not just end with the disclosure. The department will further start issuing ‘Notices’ to all the genuine tax payers and consequently the latter are vulnerable to persecution.
It would be rational for the Department to focus on high value transactions and high-risk categories involving large cash deposits rather than targeting all the tax payers.
Good cannon of taxing should necessarily understand not only the practical problems but also the natural behavior of the common man and should be always practical, realistic and supportive to the honest tax payer.
The limit of Rs.2.00 lakhs appears to be arbitrarily fixed without any discretion. There is a very high likelihood of a potential threat of harassment by the concerned statutory authorities to the innocent common citizen.
From the above deliberations, it would be ‘Just and Fair’ for the Government to increase the present limit of Rs.2.00 lakhs substantially to any higher amount so as to not to cause any harassment or hardship to the sincere tax payer.
Considering all the above points it would be necessary to use this powerful and effective ONLINE PETITION platform to bring a change by DEMANDING OUR RIGHTS.
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