Taxmen target P3 people

I-T officials get new means to trap high spenders

It may no longer be a good idea for some people to feature on Page 3 of newspapers as the taxman may be keeping tabs on "celebrities" and their splurges.

The matter is under the income tax department's consideration along with a host of other proposals to raise the number of taxpayers in the over-Rs 10 lakh bracket by 50 per cent from the present 80,000-85,000. The issue was discussed at a two-day conference of chief income tax commissioners which concluded today.

The department's south zone has proposed that a special scheme be launched for people who have made large gains from the recent stock "boom" but have not declared their income adequately.

It also proposed that transactions in immovable property be monitored and the law amended to make sub-registrars liable to deducting up to 1 per cent of the value of a transaction as tax.

Better co-ordination with other tax collection wings like the Central Board of Excise and Customs and state sales tax departments to get a list of large tax-payers is also under consideration.

Other proposals which came up for discussion included tabs on luxury excursions and high-value purchases of items like branded suits, watches, pens and paintings.

Officials said the tax department would be able to process data on high-value transactions after August 31, when it receives the first set of annual information returns.

As per the plan on the use of information on high-value transactions, the data collected will be tallied with the list of persons who have not filed tax returns, and "polite letters" will be issued to them.

The system will also help the tax department identify people whose cases will be taken up for scrutiny. These cases will also pertain to those whose transactions during a financial year are more than their income in the preceding three years.

This will be based on their tax returns. Besides, data on the basis of tax deducted at source will also be used to keep tabs on peoples' expenditure.