INDIA TAX EVADERS BEWARE
Govt to track social media posts, use big data analytics to get more people to pay up
APHOTO of your shiny new car on Instagram or the Facebook post about your chic holiday cottage may lead India’s taxman to your door.
Starting next month, Prime Minister Narendra Modi’s government would begin amassing a warehouse of virtual information collected not just from traditional sources like banks but also from social media sites, as it looked to match residents’ spending patterns with income declarations, said people familiar with the matter.
Officials would be able to spot those who pay too little tax without raiding offices and homes as they currently do, they said.
Built over seven years at a cost of about 10 billion rupees (RM667.7 million), “Project Insight” 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.
India’s efforts resemble the United Kingdom’s “Connect”, which is estimated to have cost £100 million (RM560.55 million).
Since its inception in 2010, it has prevented the loss of £4.1 billion in revenue and the number of criminal prosecutions has risen to 1,165 from 165 a year.
The government said last year it had contracted L&T Infotech Ltd to help build the network and boost voluntary compliance.
The company has agreed to the build-own-operate-transfer model, which means that while it will be running the project and earning revenues during the contract period, it will ultimately transfer the network to the government once the contract runs out.
Under the first phase, all existing data — including credit card spends, property and stock investments, cash purchases and deposits — will be migrated to the new system.
The second phase will be rolled out by December, during which data analytics will mine, clean and process the information.
In the last phase, which will go live around May next year, advanced systems will be used to predict future defaults and flag risks. Bloomberg