InvestorQ : What is the ‘transparent taxation’ platform launched by the Modi government and to which financial transactions scope has been extended?
Arusha Ray made post

What is the ‘transparent taxation’ platform launched by the Modi government and to which financial transactions scope has been extended?

Answer
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Mahil Khan answered.
1 month ago


This is a platform aimed at widening the scope of the income-tax base and checking tax evasion.  Along with the platform, the government announced various reforms to improve tax compliance. They have widened the scope of items to be included under the Scope of Reporting of Financial Transactions (SFTs). So from now onwards, these are the items that shall also be included in your 26AS. The entity you have made payment for shall be informing the government about any of the following transactions:

  • Payment of education fee/donation above Rs 1 lakh.
  • Electricity consumption above Rs 1 lakh.
  • Domestic business class air travel/foreign travel.
  • Payment to hotels above Rs 20,000.
  • Purchase of Jewellery, painting, marble, white goods, etc. above Rs 1 lakh.
  • Deposits/credits in the current account above Rs 50 lakh.
  • Life insurance premium above Rs 50,000.
  • Payment of property tax above Rs 20,000 p.a.
  • Deposits in the non-current account above Rs 25 lakh.
  • Health insurance premium above Rs 20,000
  • Share transactions/D-MAT accounts, bank lockers, etc.

The government has also made it mandatory to file an income tax return for those having bank transactions above Rs 30 lakh, all businesses and professionals having turnover above Rs 50 lakh and payment of rent above Rs 40,000. The government also proposed a higher deduction/collection of tax for those who fail to file their return. Also, under the existing scenario, any property purchase above Rs 30 lakh, Investment in shares, mutual funds, de-mat, credit card, and fixed deposit transactions above Rs. 10 lakh shall also be reported.