Creating Conducive Environment for Tax Payers in UP

Mukesh Kumar Meshram

Good governance as a concept has evolved in recent times but governance as a relationship between the state and citizens has always been pivotal to the existence of humanity. ‘Ease of doing business’ has become a precondition for realisation of the objective of good governance, says Mukesh Kumar Meshram, Commissioner- Commercial Tax Department, Government of Uttar Pradesh, in an interview with Arpit Gupta of Elets News Network (ENN).

Please give an overview of the Commercial Tax Department (CTD) of Uttar Pradesh. 

The Commercial Tax Department, Uttar Pradesh is the largest revenue earning department of the state government, having 20 zonal offices, 45 regional offices, 45 Special Investigation Branch (SIB) units, 434 sector offices and 150 mobile units spread over the state. Functioning of the department directly affects the attractiveness of the state as business destination. With computerisation of the department, dealers or taxpayers have been provided with a gamut of services which have led to greater facilitation and creation of an environment conducive to the growth of trade and commerce.

These have furthered the vision of the department, which is to develop effective and efficient systems of tax collection based on progressive use of IT and ensure an environment which is congenial for prospering of trade and commerce.

  • Basic principle – A correct and complete return shall be filed.
  • Dealers having turnover above Rs 50 lakh must file their return online.
  • Return is acknowledged instantaneously. l Return can be filed anywhere any time (24X7).
  • Offline tool for submitting the Return hence no need of continuous connectivity.
  • Acknowledgement through e mail and sms.
  • Compounding dealers have to file their return annually hence less compliance cost for smaller dealers.
  • Improved client service
  • Faster turnaround time
  • Improved accuracy and audit trails
  • Reduced processing costs
  • More secure than paper based filing
  • Eco friendly
  • Centralised data management
  • Acknowledgement through e-mails and SMS, hence improved responsiveness

As a consequence of these initiatives, tax collection has registered impressive increases. The enthusiasm with which the web portal has been received by dealers and its growing popularity has been a pleasant surprise. There are both tangible and intangible benefits of e-governance. This includes a shift from regulation to facilitation; anytime anywhere services through electronic media at the doorstep of tax payers; change from assisted services to self-services; improvement in the G2B interface; building bridges with the external world; actively inducing changes in the organisational ecosystem; and following single source of truth.

Do you feel doing business in Uttar Pradesh has become easy?

For starting a business, e-registration has been made available for which the threshold limit is Rs 5 lakh. Dealers having turnover below Rs 50 lakh have an option to avail the compounding scheme. Dealers who opt for this scheme do not have to prepare accounts. They have to submit the return annually and deposit tax equal to 0.5 per cent of the turnover on quarterly basis. An offline tool for submitting the registration application is in place. You can upload self-attested scanned copies of documents and there is a single application form for the submission of application for both VAT and CST. TIN is granted on the same day in case of non-sensitive goods and, in case of sensitive goods, TIN is granted after survey (maximum 15 days).

What are the key amendments you have carried out for dealers? 

The process of amendment in registration details is completely online. Online uploading of supporting documents, online approval/ hold/rejection of the application by the officer concerned, the facility of online tracking of application with acknowledgement ID, acknowledgement through e mail and sms, are some of the key features.

What have been the key benefits of these measures? 

Dealers can download the offline tool, fill the data and upload it according to their convenience. There is no need to print, manually fill out and send paper forms. Secure online payment processing 24×7, completely faceless process, provision for receiving automated confirmation receipt, centralised data management, acknowledgment through e-mails and SMS are some of the key benefits for the users.

These e-Services have led to reduced requirement of visits to the office and hence reduction in the compliance cost of the dealers. As a consequence, the discretion of officers is also reduced and time-bound disposal of documents has ensued. These transparency enhancing and time-reducing measures go a long way in creating a conducive environment for starting a business in the state.

What measures have you taken to protect small traders in Uttar Pradesh? 

The department has authorised NSDL (National Securities Depository Limited) facilitation centres and CSCs in order to avail e-services provided by the department. We have also done away with assessment for dealers having annual turnover below Rs 25 lakh. Commissioner, Commercial Tax selectively scrutinises 20 per cent of dealers based on risk profiling once registered dealer gets eligible for Rs 5 lakh accidental insurance.

  • E-Sancharan has been introduced to ensure hasslefree movement of goods and curb tax evasion from 1-12-2013
  • Movement of goods to be carried out by generating unique online number called “Vishisht Sancharan Number”
  • E-Sancharan facility available for all commodities
  • Dealers are to enter online details of goods on the department website to generate “Vishisht Sancharan Number”
  • Form-38 is not required physically
  • Enforcement officer can conduct online verification of “Vishisht Sancharan Number”
  • Facility of online tracking of application with acknowledgement ID
  • Acknowledgement through e-mail and SMS reflects commitment to transparency and responsiveness
  • Reduces problems of transporters
  • Prevent dumping of goods from other states to avoid tax
  • Improved customer service
  • Faster turnaround time
  • Reduced processing costs
  • More secure than paper based forms
  • Eco-friendly practices
  • Centralised data management
  • Acknowledgement through e-mails and SMS

Departmental forms required by the dealers are now available online. We also provided online generation facility for TDS certificates most of the enforcement work like generation of Detention Memo, approval and sending reports of special investigation has been made online.

These measures have ensured a hassle-free environment for small traders. Social security measures add attractiveness to the entire processes. This encourages entrepreneurship and protects small traders.

What are the key initiatives undertaken by the department to facilitate tax payment?

Our e-payment facility is available through 14 authorised banks, SBI payment gateway (with 54 banks) and SBI debit card. More than 70 per cent of taxes in 2014-15 were submitted through the e-payment facility. This has resulted in several benefits like cost reduction in processing, increased compliance, enhanced security, improved workflow efficiencies and greater visibility into financial supply chain.

These measures have also resulted in better facilitation of dealers as the requirement of any IT infrastructure on their end is eliminated

Online Public Grievance Redress And Monitoring System (PGRMS) leads to a more satisfying experience for the dealer. It develops a perception on the dealers’ part that they are being heard which creates trust between the dealer and the department. It is an integral component of the G2B interface. The CTFC is a first-of-its-kind initiative in UP and the same is being replicated in the GST system as well.