PTI
New Delhi
Cautioning that era of tax avoidance is over, CBDT Chairperson Anita Kapur on Thursday said that action would be taken against those who try to organise businesses with a view to minimise liability. Addressing CIIs global tax summit, Kapur also said that for companies with low profits, average tax rate is higher under the current regime of exemptions. Whereas bigger companies get the advantage of exemptions.
"The era of tax avoidance, am not talking about evasion, in the garb of minimising taxes, is over. And I am very sure that people who are still bent upon organising their businesses in a manner that use all kinds of tools to avoid taxes, are going to be outliers in the system," she said. Kapur said companies have to pay the government where actually a business has taken place.
"Tax is in the board rooms. Tax is no longer in the offices of the CFOs, because your brand will suffer if you get a stigma of being a tax avoider," Kapur said. Assuring taxpayers of all fairness in processes and compliance, the Central Board of Direct Taxes (CBDT) chief said the department will also need to gear up to take stern action against tax avoidance and evasion as they spoil the compliance regime.
She said the tax rates for corporates would be brought down and exemptions would be phased out gradually. Kapur also said the department has asked think tanks NIPFP and ICRIER to identify the tax gap in the system.
