Last Modified: Thu, Dec 17 2015. 01 52 AM IST
While mandatory quoting of PAN will profile all transactions, linking PAN with Aadhaar will expose instances where one person uses multiple PANs
Remya Nair
The tax department on Tuesday said quoting PAN will be mandatory for all transactions above Rs2 lakh irrespective of the mode of payment. Photo: iStockphoto
New Delhi: Those who want to keep high-value transactions under the radar will soon have few places to hide.
Mandating permanent account number (PAN) for all transactions above Rs. 2 lakh, linking PAN with Aadhaar, and the introduction of a goods and services tax (GST) are expected to together create an audit trail of every high-value transaction conducted by an individual.
While mandatory quoting of PAN will profile all transactions, linking PAN with Aadhaar will expose instances where one person uses multiple PANs. With GST also envisaged as an online system where all invoices will be uploaded, various tax agencies will be to get all details of sales, purchases, income and taxes paid by one individual.
On Tuesday, the tax department said quoting PAN will be mandatory for all transactions above Rs.2 lakh irrespective of the mode of payment. It also stipulated that cash payments of hotel bills exceeding Rs.50,000 and purchase of cash/prepaid instruments aggregating to more than Rs.50,000 a year will have to quote PAN as part of its crackdown on cash transactions where there is no audit trail.
This is in line with the series of steps taken by the tax department over the last couple of years to check black money and tax evasion. The income tax department has launched a nationwide PAN campaign to get more people to apply for PAN.
It has also started the process of seeding Aadhaar with PAN number to weed out multiple PANs. The government had also initiated a 360-degree profiling of taxpayers by matching their direct and indirect tax payments to check for tax evasion.
It also started tracking high-value transactions like credit card payments, cash deposits in banks, purchase of tax-saving instruments using PAN and checking if these individuals were filing tax returns every year.
The government is hoping that all these steps will help in checking black money, especially domestically. It has already enacted the Black Money (Undisclosed foreign income and assets) and Imposition of Tax act to look into unaccounted income stashed in overseas bank accounts. It has also introduced the Benami Transactions (Amendment) Bill 2015 to check domestic black money.