J&K Obliges Taxman

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People in J&K pay more to income tax than to the state power department. While the power tariff collections in the state were around Rs 967 crores, the gross income tax collections in the year ending March 2011 were at Rs 1179.73 crores, an all time high.

“We have a better growth rate compared to the national level,” Chief Commissioner of Income Tax Amritsar K S Pathania told reporters in June. “While the tax collections increased by more than 19 percent at the national level, they surged by 27 percent in the state.” The collections in 2009-10 were Rs 924.20 crores.

J&K bank continues to be the biggest taxpayer in the state. The only listed company in J&K, it paid Rs 300 as tax and an additional Rs 22.50 crores as TDS. “It is a substantial increase because last year there was some TDS from the bank as its tax collection was at Rs 243 crores,” a senior official in the IT said. The bank that was earlier paying its tax in Jammu has shifted its account to Srinagar where its corporate headquarters is based.

Pathania said the tax payer base in the state continues to be narrow. “It is slightly less than the one percent of the state population,” he said. There are 114410 taxpayers in the state besides 603 companies.

The yearly income, Pathania said is increasing with the gross collection surge and part of it comes from the Tax Deduction at Source. The TDS has increased by more than 150 per cent during the last one year. At the same time, however, the refunds also witnessed quantum jump. In 2009-10, the department refunded an amount of Rs 40 crores to 5628 individuals tax payers which jumped to Rs 344.89 crores in 25857 cases.

Better compliance, insiders in the IT say, is because of awareness in the drawing and disbursing officials and linking tax returns to the businesses including start-ups. Off late, the IT department launched massive awareness and took special care of the traditional tax evaders. The sleuths are regularly monitoring the accounts of various business houses. During the last fiscal, the department raised Rs 20 crores income that eight business houses in Srinagar and Jammu surrendered in wake of IT raids.

Taxmen in Srinagar insist that J&K has the potential of paying more tax given the surging consumer market. They are in the process of crafting massive mass awareness plans, this time, targeting the youth. Taxman says educating youth would essentially add to the scale of compliance in the state.

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A journalist with seven years of working experience in Kashmir.

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