Excise, service tax automation to curb evasion

It is not just the income-tax department which is tightening the noose around tax evaders. Come October, the Central Board of Excise and Customs will implement a pilot project for automation of both excise and service tax, which, in addition to encouraging e-filing, would also create a database and profiles of excise and service tax payers.

The software module for the project is being developed for the department by Wipro. The pilot project will initially be limited to selected metros. Then it will be introduced in all other towns and cities.

"At present, the excise and service tax departments are mostly manual. We intend to automate these and gradually shift to a stage when all the documentation is done online," an official of the board (CBEC) said.

The revenue department is identifying service centres where excise and service tax payers can file returns online, officials said, adding that e-filing will not be mandatory, initially.

Automation will increase the transparency of the excise and service tax department by enabling taxpayers to track the progress of their refunds.

"A manufacturer who pays excise would now be able to track his Cenvat utilisation, check the progress of a refund claim filed and of claims outstanding," officials said.

At the same time, the department will also be able to track those who deliberately claim higher Cenvat credits or pay lower excise or service tax.

"The department will create profiles of taxpayers similar to what is being done by the income-tax department. While the module will use the permanent account number (PAN) as the basic identification, taxpayers who want to view details of their payments and refunds will be given a secure password by the department," officials added.