The Union Finance Ministry is preparing to launch ‘Project Insight’ from October 2017 to check high value transactions and detect tax evaders using technology by using a view to curbing circulation of black money.
To implement the project government has signed contract with Information Technogolgy major L&T Infotect Ltd. The project will prove to add to read of efforts that is generated by government to curb black money like Operation Clean Money’ after demonetisation, Income Disclosure Scheme, GST implementation, amendment DTAA with countries etc.
It will use data mining, big data analytics to scoop out tax evaders from social media platforms to deduce mismatches between spending pattern and income declaration. The linking of PAN (Permanent Account Number) with Aadhaar will probably be key identifier used by IT Department to link and analyse various transactions with regards to tax payers.
The integrated i.t platform can help in catching tax evaders in non-intrusive manner using technology and without traditional intrusive methods like search and seizure. It will use technology providing government collate databases of IT forms, IT returns, TDS/TCS statements and Statement of Financial Transactions received from financial institutions.
Its reporting compliance management system will make it possible for other reporting entities like banks and also other loan companies is timely and accurate. It'll likewise developed streamlined data exchange mechanism for other government departments.
It will also be leveraged for implementation of Foreign Account Tax Compliance Act Inter Governmental Agreement (FATCA IGA) and Common Reporting Standard (CRS). IT Department it would to set up new Compliance Management Centralised Processing Centre (CMCPC) to handle preliminary verification, campaign management, generation of bulk letters/notices and follow-up.
Project Insights will play key role in widening of tax base and data mining to track tax evaders. It assists in catching tax evaders in non-intrusive manner like search and seizure. It assists to promote voluntary compliance and in addition enable taxpayers to eliminate simple compliance related issues in online manner without visiting Income tax office.