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VDIS yields more than Rs 50 billion

Revenue Secretary N K Singh today said the Voluntary Disclosure of Income Scheme has yielded more than the targetted Rs 50 billion, with about 250,000 to 300,000 people availing of it.

Though the figures were still being computed ''it would definitely and clearly exceed Rs 50 billion which was the upper end of the expectations which any one had at that time (of introducing the scheme),'' Singh declared.

Having achieved the target, the ministry would in the next three months concentrate on further widening the tax base.

The four criteria -- owners of either flat, car or telephone or who have visited abroad -- would now be strictly enforced to cover those who had not availed of the VDIS, he warned.

''Tax evaders will continue to come to the notice of the department,'' he said.

Tax collection, both direct and indirect, was going on along the expected lines to meet the target of Rs 420 billion, said Singh, adding, "The results of the VDIS available so far showed that the scheme has met with a very strong and positive response."

It was set to recover more than ''the target and expectations'' of bringing black money into the productive system.

People from all sections of society, including the middle class and upper middle class, took advantage of the scheme, which had a very large geographical cover, Singh stated.

Both the metropolitan cities and provincial towns produced encouraging results. The diversity of the assets declared included cash, jewellery, precious stones, silver, real estate, and other forms of immovable assets.

All this showed that ''the basic objectives of the scheme seem to have been significantly realised,'' the revenue secretary said.

The success of the scheme was largely due to the innovative tax reforms introduced by Finance Minister P Chidambaram in the 1997-98 budget where tax rates were moderated, he added.

This, he insisited, "broadly bears out the general hypothesis that a normal Indian is a law-abiding citizen who has resorted to tax evasion historically only when the rates of taxes were irrational and unreasonable and that given a chance he would like to live in conformity with the law."

The carefully orchestrated strategy and campaign seemed to have paid rich dividends in terms of creating wider awareness. It successfully put across the message in regional languages both through the electronic and print media.

"The VDIS ushered in a new milieu and a culture of tax compliance instead of tax evasion which is the main objective of the scheme outlined by the finance minister," Singh declared.

About the devolution of the revenue earned under VDIS, Singh said 75 per cent of it would go to the states after the financial year was over, ''may be next year.''

The collection was not income tax. It was new tax and therefore ''there will be a new entry.'' Singh said a large number of those who availed of the VDIS had not paid tax on the disclosed amount so far.

They had been given 90 days' time from the date of declaration of concealed income. Though they would not have to pay any penalty, a two per cent interest would be charged on the tax amount, he added.

EARLIER INTERVIEWS:
N K Singh, revenue secretary
V M Muthuramalingam, chief commissioner, Income Tax Dept, Bombay UNI