Huge Controversy Over Suggestion To Raise Taxes, Centre Says "Misconduct"

The proposal of certain officials of the Indian Revenue Service to raise the government revenue in the backdrop of the coronavirus pandemic by increasing taxes is an "act of indiscipline", the Centre said on Sunday. Such a report was neither sought and nor is it the IRS Association's duty to prepare it, the government said, calling the association's move "misconduct" and an act of  "indiscipline".

The chairman of the CBDT (Central Board of Direct Taxes) to whom the report was submitted, has been asked to seek explanation on the matter from the office bearers of the association.

In a 44-page report titled FORCE (Fiscal Options and Response to COVID-19 Epidemic), officials who called themselves "Team Force" made a series of suggestions that include hiking tax on super-rich to 40 per cent, levying pandemic cess and imposing higher tax on foreign companies.

"The estimate for gross tax revenue for 2019-2020 was revised lower to amount. 21.6 lakh from Rs. 24.6 lakh crore announced in the previous budget. Even for the upcoming financial year 2020-21, there is a target of 12% increase in the gross tax revenue at Rs. 24.2 lakh crore. However, the slowdown in economy coupled with COVID-19 will dent the revenue collections especially in direct taxes," the report said.

The government said it has taken a range of measures to help the people and taxpayers in these difficult times and "will not hesitate to do more".

(1/3)There is some report circulating on social media regarding suggestions by a few IRS officers on tackling Covid-19 situation.
It is unequivocally stated that CBDT never asked IRS Association or these officers to prepare such a report.@nsitharamanoffc @Anurag_Office

— Income Tax India (@IncomeTaxIndia) April 26, 2020

Sources in the Finance Ministry said the report does not reflect the views of the CBDT or the Finance Ministry.

Pointing to the government's provision of various relief packages, they said the Finance Ministry is doing its best to provide relief and bring liquidity into the system and ease the lives of people.