Six months after demonetisation a lot of compliance is being heard by way of new taxpayers making to the taxpayer’s list. According to Finance Minister Arun Jaitley, 9.1 million people were brought under the tax net post demonetisation and he is confident that the number will only go up further.
Outlook Money has been tracking the development of Operation Clean Money campaign that the ministry and the Central Board of Direct Taxes (CBDT) had initiated on January 31 with the launch of e-verification of large cash deposits made during November 9 and December 31, 2016, when people were allowed to deposit cash in demonetised currency in banks.
The entire process of depositing the withdrawn currency denomination with the bank resulted in people, who had managed to function with just cash transactions to not just deposit the cash they had, but also look for ways to clean their act for the future.
On its part, the CBDT ensured there was minimal intrusion for those who were identified with cash transactions that did not match their profiles. This number was a staggering 1.8 million, of whom more than half did not have to visit even the income tax office as the matter was resolved through the tax department’s website and email exchanges.
In the second phase of Operation Clean Money, the CBDT is looking into over 6,000 transactions, where the scrutiny is likely to be more detailed. This would also include those who did not respond to communication in the first leg. By engaging data analytics firms and its own intelligence gathering, the department has graded the various cases under Operation Clean Money in three categories of ‘high risk’, ‘medium risk’ and ‘low and very low risk’. The impact of demonetisation is far reaching and its real effect will be felt a few years from now as the taxpayer base goes up, which will automatically also increase the tax collected.
Operation Clean Money
- 22% growth in e-filed returns after demonetisation
- 52.8 million returns filed up to March
- 300 million PANs allotted
- 371,000 new accounts relating to 158,000 taxpayers who made partial declaration of accounts and amounts in responses under phase-1 of Operation Clean Money
