IRS officers’ report on funding Covid relief work via tax measures ill-conceived: Finance ministry sources

MUMBAI/NEW DELHI: A group of tax officers has suggested hiking super-rich tax to 40 per cent, imposing a cess and other measures to increase revenues amid the coronavirus pandemic, prompting the tax department to clarify that the proposals do not reflect its official views in any manner.

The Central Board of Direct Taxes (CBDT) has also ordered an inquiry against the officers for going public with the report without permission while sources in the finance ministry said the views of the officers were ill-conceived.

The paper titled ‘FORCE’ which stands for ‘Fiscal Options & Response to COVID-19 Epidemic’, dated April 23, has been sent to CBDT Chairman P C Mody and the board members.

Apart from pandemic cess, the paper has suggested imposing higher tax on foreign companies, re-introduction of inheritance tax and raising the equalisation levy, among others.

It was prepared by 50 tax officers after CBDT sought ideas from field officers on ways to revive the economy and improve revenue collection.

On Sunday, CBDT said an inquiry is being initiated against the 50 IRS officers.

According to the apex body, it had never asked IRS Association or these officers to prepare such a report and no permission was sought by them before making the report public.

It also said the “impugned report” does not reflect the official views of CBDT/ Ministry of Finance in any manner.

CBDT’s statement came soon after the sources said the ministry has directed Mody to seek explanation from the officers for writing such “ill-conceived views” in public without having any authority to do so.

“It was not even part of their duty to prepare such a report. Therefore, it is prima-facie an act of indiscipline and violation of conduct rules which specifically prohibits officers to go to media with their personal views