E-governance in Commercial Tax Administration

THE WEST BENGAL EXPERIENCE

VISION

To build up an Information and Communication Technology (ICT) enabled modern tax administration that is transparent, equitable and efficient.

MISSION

To build a robust IT infrastructure for seamless, transparent and efficient services to the people of the state.

To cause process transformation and roll out e-services and replace the archaic manual system

To develop a system capable to prevent tax evasion and encourage compliance.

A brief about the Commercial Tax Directorate (CTD)

With a humble beginning as a levy to meet war time expenses that dates back to 1941, Sales Tax gradually went on to become the mainstay of state revenue. It now accounts for more than 60 per cent of State’s own revenue and continues to grow steadily, constantly trying to reach the target set for it. It was among the first few state govt. wings that took pioneering steps to usher in e-governance in West Bengal.

Collection of Tax by CTD over the last one decade

Growth of Collection ( 2001-2012)

2000400060008000

100001200014000160001800020000

Year

Rs.

in C

rore

VAT/CST/WBSTTotal

VAT/CST/WBST 3814.00 4191.51 4830.78 5721.70 6119.14 7108.68 8092.58 8967.40 10623.68 13368.44 15904.44

Total 4129.42 4676.43 5740.32 6879.73 7253.28 8284.54 9425.40 10279.49 11992.01 15110.78 18174.22

Profession Tax 215.87 223.34 229.89 237.43 249.15 264.85 295.07 313.41 362.40 388.54 424.93

Coal Cess 20.46 15.60 352.82 606.78 665.33 665.08 735.77 700.37 664.06 966.89 1478.4

Cess on Petrol 0.00 152.57 217.82 209.62 181.99 216.93 263.51 298.31 320.62 355.38 366.45

Grow th % -0.27 13.25 22.75 19.85 5.43 14.22 13.77 9.31 16.4 25.82 20.45

2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

Targets & Achievements of Collection of taxes(Net Figures)

0.001500.003000.004500.006000.007500.009000.00

10500.0012000.0013500.0015000.0016500.00

Rs.

in c

rore

s

Target 8300.16 9794.18 10387.91 14082.91 16063.68Achievement 8060.46 8955.09 10501.73 13368.44 15904.44

2007-08 2008-09 2009-10 2010-11 2011-12

Some lacunae of the pre-reform era

The basic legal provisions marked by multiple tax rates, concessions and the procedures laid down to implement it were complex.

Every major process like registration, filing of returns, payment of tax, obtaining forms and waybills required frequent physical visits to the department causing harassment of the taxpayer.

Monitoring processes were manual with room for avoidable discretions and record keeping system was archaic.

Purposes of reform

Increase ease of compliance for dealers through simplification and standardisation of legal provisions and procedures

Minimise discretion and arbitrariness in decision making and administrative actions

Reduce avoidable physical visits to ST offices Increase operational efficiency & faster disposal To develop a robust database and use ICT to

prevent evasion of tax through.

Towards reforms – step by step Database cleaning Providing user id and password Amendments in law Constitution of PeMT Preparation of Detailed Project Report Establish Connectivity and networking Procure hardware Develop applications Roll out e-services Measures to facilitate access to e-services Use ICT for effective tax monitoring

Cleaning of Database The cleaning process aimed at - Elimination of non-entities by way of cancellation of

registration certificates of the dealers who had closed down their respective businesses or whose liability to pay tax had ceased; and

To discourage the habitual defaulters and induce them in filing periodic Returns in time.

Centralized initiative was taken by issue of show cause notices to defaulters of returns for two successive quarters. In the process around 57 thousand registration certificates have been cancelled through centralized initiative.

User id and password

User-ID and Password was communicated to the dealers individually up to 31.03.2010.

A dealer can generate his own User-ID & Password

from 01/04/2010 by providing his RC No, PAN and his e-mail address as stored in the CTD database.

All “electronic services” are single sign-on services.

Amendments in law

Amendments in the Act and Rules are necessary to make adequate legal provisions to introduce electronic methods in vital processes like filing of returns, application and grant of registration, dematerialised waybills, transit declarations, central forms etc under the relevant Acts like the VAT, CST, Sales Tax Act and Profession Tax Act.

Constitution of PeMT

A Project e-Mission Team was formed under the stewardship of the Commissioner of Sales Tax and representatives of NIC, WTL, Finance Department as members.

A number of sub-committees with officers of the Directorate were set up under the PeMT for the purpose of development of different modules. These sub-committees helped from preparation of SRS to suggestions to fine tune e-services at the post roll out stages.

CONNECTIVITY AND NETWORKING

Most of the offices of CTD are connected under WAN on (WBSWAN) as backbone. .

Rest offices are directly connected through BSNL leased line/ Managed Leased Line (MLLN).

NETWORKING - LAN

Each office of CTD have LAN to access the Central database /Alpha Server at Beliaghata HQ.

Total 996 LAN connections have been provided

to various Charge, Range, and Circle and Profession Tax offices .

Work is underway to install another 1600 LAN

points.

EXTERNAL CONNECTIVITY

E-services are hosted at NIC web server at Rowdon Street office.

The CTD Beleghata is connected to NIC Rowdon Street through 10 mbps BSNL link,

Power grid Corporation provides redundant connectivity.

The CTD HQ is connected to the Writers building to avail the SWAN backbone.

PROCUREMENT OF HARDWARE

PURCHASE OF CENTRAL SERVER – The existing central Alpha server was procured in 2002 and the OEM has declared its end of life. CTD, WB has purchased a new central server located at the State Data Center (SDC) Salt lake SDC is connected to the HQ at Beliaghata through two 1Gbps link lines.

PROCUREMENT OF HARDWARE

The Commercial Tax Directorate is going to procure the following system of servers soon One Web server to support the web based services Two Disaster Recovery Server (DRS) to be located at different seismic zone Two Development servers

PROCUREMENT OF PC, PRINTERS

The goal is to provide computer support to all functional units at all levels.

Desktops, UPS and printers have been procured in phases through open tender in strict compliance of purchase policy of the state government.

At present there are almost 1500 PCs and more are going to be procured

ROLL OUT OF ONLINE SERVIVES

The Commercial Tax Directorate has rolled out various e-services that may be accessed through its official website www.wbcomtax.gov.in

The e-services rolled out by CTD are related to – • Registration • Payment of tax • Way bill • Transit Declaration • Declaration forms • Returns • VAT Refund • Dealers’ Profile • Sales tax Deduction at Source (STDS) • Industrial Promotion and Assistance Scheme(IPAS) • Grievance redressal • Anti-evasion

ONLINE REGISTRATION

Introduced w.e.f 01/04/2010 and now it is mandatory. Make online application Send physical copy by post (not Required if digitally

signed) Officer grant/interim objection/reject with reason No personal interview or visit to the place of

business Print of certificate of registration may be obtained

Usage of e-Registration service during 2011-12

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

1 2 3

Nos. of Applications Filed

Nos. of Applications Disposed

Nos. of Demat RC Generated

Period : 2011-2012

Nos. of Applications Filed 16731

Nos. of Applications Disposed 9848

Nos. of Demat RC Generated 9848

ONLINE PAYMENT OF TAX

introduced from May 2008 From 3 banks to 9 banks Accounts for about 80% of total collection. Regular transmission of e-payment data by banks to CTD. Introduction of payment portal of Finance Deptt from

10.10.2012 for e-payment. After all the validation checking, they will be redirected to the selected bank’s portal for payment.

In new system, more banks (nationalised banks as well as private banks) will be given authorisation.

E-payment becoming the main mode of tax payment with time

45%

55%

2009-10

e-Payment

Manual Payment

68%

32%

2011-12

e-Payment

Manual Payment

ONLINE WAYBILL

Introduced w.e.f 01.12.2010 No endorsement is needed at checkposts Advance declaration Consignee generate key Consignor/transporter can print waybill using the key Validity 30 days UC within 40 days Auto enhancement of quota based on UC UR dealers can also obtain online waybill w.e.f 1.4.2012

Online generation of Way bill

0

500000

1000000

1500000

2000000

2500000

2010-2011 2011-2012

Total Nos. of Demat Waybills Generated

Total Nos. of Demat Waybills Generated

ONLINE TRANSIT DECLARATION (TD)

Required to transport goods using West Bengal as corridor

Online TD was introduced w.e.f 15.11.2010 Online TD is generated without any counter

signature of any official. After exit of the goods from West Bengal the

utilisation has to be submitted electronically within two days.

Generation & utilisation of e-TD

ONLINE DECLARATION FORMS

Dealers were allowed the facility to generate dematerialized Central Forms ( ‘C’ and ‘F’)Forms in respect of transactions made with effect from 01/04/2010.

The printed forms need not be endorsed by any authority of the Commercial Taxes Directorate.

Generation of Demat CST forms

ONLINE RETURNS

Introduced w.e.f Q.E. 31/12/2007 for only 4518 selected dealers under VAT & CST Acts.

Made compulsory from the period Q.E. 31/3/2010. However, dealers are required to submitted signed hardcopy of return at the charge offices.

Filing of e-return under Profession Tax and WBST Act started from 31/12/09 and

Growth in number of e-returns

Digital Signature Certificate CTD has introduced the facility to file e-return

using Digital Signature Certificate (DSC) for the return period of Q.E. 30.9.2012.

This will relieve dealers of the obligation to file hard copy of returns.

The government is allowing small dealers with turnover below Rs. 2 Crores to obtain DSC at subsidized rates

SHORT MESSAGING SERVICE The CTD has introduced Two types of SMS

service - Intimation SMS service- for the benefit of the

taxpayers Query SMS service- facilitates queries by the

officers of the Directorate as well as dealers.

OTHER IMPORTANT E-SERVICES

ONLINE VAT REFUND – Online application for pre-assessment refund. Refund payment through ECS introduced from

08/07/2011 E-STDS – Online Enrolment/ Registration with

(STDS) Cell Generation of online STDS certificate and scroll

introduced w.e.f. 22/01/2012.

OTHER IMPORTANT E-SERVICES

E-Industrial Promotion and Assistance Scheme (IPAS)–Online application for industrial assistance.

E-declaration for Deemed Assessment –Online filing of declaration necessary to get selected for deemed assessment.

OTHER IMPORTANT E-SERVICES

E-grievance – Online filing of grievance petition introduced

from 25/7/2011. Out of 133 cases of grievance received

during 2011-12, 116 were redressed. E-Anti-evasion– Online furnishing of information by citizen to

promote anti-evasion efforts.

WHAT’S NEXT E-SAHAJ – a composite single online return

for VAT, CST and WBST Acts. Online post assessment refund Online Appeal, Revision, Recovery Online registration under WBST Act Online Audit & Assessment

FACILITATING INITIAVES USER MANUALS for each e-service provided in the

website. HELPDESK – CTD is running helpdesk at its Headquarters.

An Interactive Voice Response System (IVRS) based helpline facility is going to be set up soon.

FACILITATION CENTERS (F.C.)–229 private F.C.s spread all over the state to facilitate e-services.

Subsidy against free return filing services rendered to small dealers.

VAT Return Preparers (VRP) – Initiative has been taken to train 1000 unemployed youths as VRP.

I.T. for Departmental Users

IMPACT – Dealer profile MIS

INTERNAL WEBSITE TINXSYS

IMPACT – Dealer profile

A comprehensive in-house application titled ‘IMPACT’( Information Management for Promotion of Administration in Commercial Taxes) for the CTD.

Departmental users get detail information of registered dealers on registration data, return figure, import data, payment details and so on.

Details of the dealer against the given RC No. are displayed in the following way -

Proprietor’s Name

Trade Name

Address of principal place of business

Circle

Group

WBST No. CST No. VAT No.

To clear the screen click

here

To view these information click on the activated

‘Get’ buttons

MIS and Internal Website MIS like mis-match reports on claims of input tax credit , total import during a period made by dealers, total payment of tax etc for effective revenue monitoring. An internal website for departmental circulars,

orders, trade circulars, e-service related information, new announcements etc.

MIS reports generated by ISD for Charge offices to work upon

Non filers with huge sale Comparison of Tax growth Sale –Purchase mismatch Waybill-vs-purchase-vs-sale-vs-tax paid Provisional assessment for return defaulter Same purchaser and sellers Waybill generated by return defaulter Excess ITC claim

TINXSYS Tax Information Exchange System ( TINXSYS ) is a

Centralized solution to facilitate Information exchange between State Commercial Taxes Departments (CTD)

TINXSYS is a solution to address problems associated with tracking of nationwide Inter-state trade.

TINXSYS is a database of all inter-state transactions for generating requisite MIS (Management Information System) reports for participating states in the nation.

TINXSYS provides a platform for dealers to verify the validity of registration numbers (TIN) and CST Forms of their counter party dealers.

TINXSYS – data availibility

The system has a data backup since 01.04.2004 All participating states share the Dealer info and CST

Forms info of the respective state with this system West Bengal is one of the pioneers in uploading such

data to this platform since 01.04.2004 There is a direct connectivity between the state HQ and

the TINXSYS data centre TINXSYS periodically fetches data straight from the

intermediary server to their system All dematerialsied forms data are available in TINXSYS Current data availibility for WB is up to 04.07.2012 (

likely to be updated by end of this month)

Scope of Information exchange

Way bill information C form Information TD information Dealers existence Transporter enrolment Vehicle registration and movement Documents endorsement at different

checkposts

CCT/WB cct.ctax@nic.in

AddlCCT addlisd.ctax@nic.in

Thank You