Somewhere in the financial year 2016, the Income-tax Department had initiated a ‘Project Insight’ with an objective to curb the tax evasion measures. Through this project the Department planned to use the contemporary technology for data mining, research and analytics against black money and tax evasion. For this purpose, the data could be sourced from other Govt. organizations and social networking sites. The motive behind it was to trace the assessees who were at high risk of tax evasion.
For implementation of this project the Income Tax department had signed a contract with L&T Infotech Ltd. The project was scheduled to be rolled out in 3 phases and 1st phase was originally expected to be launched in May 2017.
Under this project, an integrated platform had been planned which would play a key role in widening of tax-base and data mining to track tax evaders. It was also be leveraged for implementation of Foreign Account Tax Compliance Act inter-governmental Agreement (FATCA IGA) and Common Reporting Standard (CRS). Implementation of reporting compliance management system would ensure the timely and accurate reporting by the reporting entities. For this purpose, a streamlined data exchange mechanism was also to be set up with other Government Departments and exchange partners.
The goals for initiation of project insight was to promote voluntary compliance and deter non-compliance, Impart confidence that all eligible persons pay appropriate tax and Promote fair and judicious tax administration. Under this project an integrated data warehousing and business intelligence platform is being rolled out in a phased manner. The project would operationalize two new centres: 1. The Income Tax Transaction Analysis Centre (INTRAC) to leverage data analytics in tax administration and undertake tasks related to data integration, data processing, data quality monitoring, data warehousing, master data management, data analytics, web/text mining, alert generation, compliance management, enterprise reporting and research support. 2. The Compliance Management Centralized Processing Centre (CMCPC) would use the campaign management approach (consisting of emails, SMS, reminders, outbound calls, letters) to support voluntary compliance and resolution of compliance issues. A dedicated compliance portal would be used to capture response on compliance issues in a structured manner for effective compliance monitoring and evaluation. Under Project Insight, the Income-tax Department is planning to use the data available with it as well as other government organisations, such as Registrar of companies, GST database, RBI records, Social network, etc. The motive behind it is to trace the assessees who are high risk cases of tax evasion. It is believed that Dept. may scan posts of taxpayers on social networking sites to assess if taxpayers lifestyle do not match with the income disclosed in the income-tax returns. However, the information collated from social networking sites may not constitute sufficient evidence for the Dept. to initiate an enquiry against a person who has flaunted a luxury car on a social networking site. Mostly news channels and media houses are reporting about launch of such projects with effect from April 01, 2019. However there is no official announcement for launch of project insight by the department.
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