How does the Gov find out about tax evasion

[preetksgill]

Indian Income Tax department has deployed a new technology in the form of specially trained pigeons which keep a track of all your financial transactions by visiting the locations they are sent to to collect data.

Each pigeon is equipped with special spy camera in their collars.

The efficiency level achieved by the IT department through this venture is tremendous, far far more than any other electronic medium.

IT department exceeds all international standards for the ethical treatment of its pigeon personnel. Not only are they given free range of the coop and its window ledges, special break rooms have been set up for their convenience. These rooms are stocked with an assortment of delectable seeds and grains and feature the finest in European statuary for roosting.

While no pigeon has actually been confirmed for a seat on the Supreme Court, pigeons are surprisingly adept at making instant judgments when confronted with difficult choices. This makes them suitable for any job requiring accurate and authoritative decision-making under pressure. Among the positions in which pigeons have served capably are replacement air traffic controllers, butterfly ballot counters and pro football referees during the "no-instant replay" years.

 

[xienes1]

the contrast is really stark.

if i delay even a one rupee of tax payment, especially central excise, i can go to jail

but

nobody goes to jail even if they put a 350 crore rocket into sea !

a gurgaon delhi expressway-partly connecting airport of largest democracy on earth to its capital, can't be built in 5 years..

and

they plan a "chandrayan"- to send an indian to moon.


Income Tax-publicity line .. " Taxes are paid-Nations are made"

yes- nation means only "babus, police officials and netas". All others are despicable "private sector".Any document/form attested by a babu (gazetted officer) is gospel truth !

We, who pay taxes:

- are not sure that our children will get admission in professional courses.

- will have to pay enhanced home loan interest every 6 months so that RBI can control money supply to an "overheated real estate". Does my 'small two bed room box apartment' home loan has to bear the brunt of RBI's maneouvers to tackle machinations of Parsvnaths, Unitechs, Peninsulas, Omaxes.....? Yes, babus, netas and RBI governor don't care. Because they don't have to pay back a home loan. They are more concerned how to get allotted a more bigger bungalow in Luytons Delhi for themselves.

- will have to step aside for a red-beacon/siren blaring car of a "public servant" babu or neta paid for by our taxes.

- can be mowed down or killed by kins of likes of Nandas, Yadavs or Sharmas.

etc. etc.

i shudder to think what would have happened to IT and BPO if IAS babus were in control of this industry. Chandrashekhar had mortgaged even the gold of our country !

Sometimes I wonder if we are better off after "freedom" from British. I think we are not. IAS, Police and Netas are true beneficiaries of freedom.

Honest tax paying people would have been much much better under "British Raj" instead of today's "Democracy Raj of IAS, Police and Politicians" It is really a freedom for our ruling class from British. For, "aam aadmi" was even in British Raj ruled in similar manner by their civil service, expected same behaviour in police stations, govt. offices, utility services etc. as today.

Afterall, this is supported by fact that NRIs working under British, American or Arab "Raj" are much more better off than we resident indians with our 60 years of desi "freedom"

Totally agree with you.
Common man still bears the burnt of exploitation.
Only those who exploit have changed , earlier it was white skinned foreigner as***les, now our own countrymade desi as***les.

 

[MaxBombay]

I'm a salaried person. But I wanna know, if somebody does not declare a particular income, how does the gov find out ? Are all the financial transcations logged against one's PAN. ( is India so advanced ? ). My friend once sold his shares and made a profit of 10K. He simple forgot to declare his profit, but nothing happened to him !

10k is not big amount however, if he comes under scrutiny (if he is high tax payer then he will definitely come every few years - i can assure you for that then he will be asked to produce all documents supporting his bank account, credit cards transactions and if he is failed to produce any such documents then he will be fined for tax evasion and will pay interest on tax amount due till date. Remember income tax officers can ask for up to 6 years of your old records and if you failed to produce them for some reason you can be taxed extensively.

Its always better to pay tax and keep your head high. Income tax helps us develop strong nation. Find legal ways to pay less tax rather then invade tax, because they will hunt you down one day and you will suffer.

I assume following are the ways income tax department keep tracks of transactions.

1) payments made through credit card
2) cash deposits / withdrawal of more then 25,000 from your bank account, higher the amount and you are definitely under scanner.
3) cheque deposits of high amounts (more then 10 lakhs)
4) property dealings

Now days government has made it mandatory to supply PAN card numbers every where (phone, electric, bank accounts etc.,) and in most cases if you are making any large transaction and you are not filing income tax returns then some day you will definitely hear from income tax department.

Its always better to file NIL return income tax then filing no returns at all.

My views on Income tax in India.

In India direct tax is very high, specially when compared to service received from government. In India if you earn Rs.2 lakhs per month then you will pay roughly Rs.650,000 income tax and if you earn same amount in united states you will pay ONLY roughly RS.425,000 taxes.

Now you may say In united states living expenses are high hence high tax rate in India makes you even, but this is not the case. In united states government gives you FULL POLICE PROTECTION, SOCIAL SECURITY (government will pay you nearly 30% money required for food and shelter if you register for unemployment) LUXURY roads, LUXURY houses, wonderful legal system, environment to do business and grow faster which is clearly not the case in India. Since government is failing to provide services to high income tax individuals they should charge less income tax.

My request to honorable finance minister is to greatly reduce direct tax burden on individuals and increase indirect taxes, so that more and more people can be included under tax bracket. My request to honorable home minister will be to setup time frame for court decisions, make provision for heavy fine on CORPORATES COMPANIES IN CASE OF MALPRACTICE and increase police protection across cities where police is treated as law enforcers and service providers and not maye bap.

 

[NewUser]

While I am not applauding the current state of the indian affairs, I do not think the comparison with the developed countries is fair (from a historical perspective).

When comparing India to the US, please keep in mind that India is a nation in the development phase, as opposed to the developed phase.

Just for kicks, below is the top marginal tax rate in the US in the last century:
(Highlighted anything over 60% tax rate in RED)

Year Top Marginal Tax Rate
1913 7.0%
1914 7.0%
1915 7.0%
1916 15.0%
1917 67.0%
1918 77.0%
1919 73.0%
1920 73.0%
1921 73.0%
1922 58.0%
1923 43.5%
1924 46.0%
1925 25.0%
1926 25.0%
1927 25.0%
1928 25.0%
1929 24.0%
1930 25.0%
1931 25.0%
1932 63.0%
1933 63.0%
1934 63.0%
1935 63.0%
1936 79.0%
1937 79.0%
1938 79.0%
1939 79.0%
1940 81.1%
1941 81.0%
1942 88.0%
1943 88.0%
1944 94.2%
1945 94.2%
1946 86.5%
1947 86.5%
1948 82.1%
1949 82.1%
1950 84.4%
1951 91.0%
1952 92.0%
1953 92.0%
1954 91.0%
1955 91.0%
1956 91.0%
1957 91.0%
1958 91.0%
1959 91.0%
1960 91.0%
1961 91.0%
1962 91.0%
1963 91.0%
1964 77.0%
1965 70.0%
1966 70.0%
1967 70.0%
1968 75.3%
1969 77.0%
1970 71.8%
1971 70.0%
1972 70.0%
1973 70.0%
1974 70.0%
1975 70.0%
1976 70.0%
1977 70.0%
1978 70.0%
1979 70.0%
1980 70.0%
1981 69.1%
1982 50.0%
1983 50.0%
1984 50.0%
1985 50.0%
1986 50.0%
1987 38.5%
1988 28.0%
1989 28.0%
1990 28.0%
1991 31.0%
1992 31.0%
1993 39.6%
1994 39.6%
1995 39.6%
1996 39.6%
1997 39.6%
1998 39.6%
1999 39.6%
2000 39.6%
2001 39.1%
2002 38.6%
2003 35.0%