Mumbai, July 31: The government will begin collecting all the virtual information of a person’s pictures uploaded on social networking site Facebook. These pictures of one’s shiny new car or an exotic holiday cottage may lead the Income Tax officials to the person’s door. With this, the government will look at the residents’ spending patterns with income declarations, reports TOI. This is called ‘Project Insight’ and it will complement the world’s largest biometric identity database and India’s most ambitious tax overhaul as policymakers try to get more people to pay up. It took seven years to build at a cost of about Rs 1,000 crore.
The tax officials will spot those people who pay too little tax without raiding offices and homes only by viewing their post activities on Facebook. “This will put an end to harassment by tax officials as there will be no public interface,” said Amit Maheshwari, managing partner at an accountancy firm near New Delhi. This method is already used by countries like Belgium, Canada and Australia to unearth the tax evasion that sometimes goes undetected without technology. Finance ministry spokesman D S Malik declined to comment on Project Insight. The BJP government said last year it had contracted L&T Infotech Ltd to help build the network and boost voluntary compliance.
According to government data, India’s tax-to-GDP ratio is about 17 per cent compared with 25 per cent for most Asian countries. Compliance will rise 30 per cent to 40 per cent during the first phase of the project, people familiar with the project said. All the existing data including credit card spends, property and stock investments, cash purchases and deposits will be migrated to the new system during this time and a central team will send postally or email blasts to prod residents to file tax declarations.
The second phase of this project will start by December. During this time, data analytics will mine, clean and process the information. Individual spending profiles will be created and inquiries will be more targeted. The last phase begins around May 2018 during which advanced systems will be used to predict future defaults and flag risks
