The Union Cabinet today approved an additional expenditure of Rs. 442.03 crore for full computerization of Income Tax Department.  This is in addition to earlier amount of Rs. 251.56 crore sanctioned in December, 2002.

The additional funds are needed to meet the enhanced requirements relating to single national database as part of the sanctioned project for full computerization of the Income Tax Department and running it for 5 years.  This will lead to computerized matching of large databases for identifying non-filers and for detecting tax evasion resulting in

1.            Increase in revenue collections

2.            Increase in efficiency and productivity

3.            Improved service to taxpayers

4.            Increase in level of deterrence against tax evasion

5.            Widening and deepening of tax base

Expenditure sanction of Rs. 251.56 crore was accorded by the Cabinet in December, 2002 for third Phase of Computerization Plan of the Income Tax Department. The present proposal is for additional sanction of Rs. 442.03 crore primarily on account of inclusion of expenses on running and managing the All India Income Tax Network, National Data Centre, Business Continuity Planning (BCP) Site, Disaster Recovery (DR) Site and Facilities Management Services for a period of 5 years.

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