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Market analyst says Modi 2.Zero readying a crackdown on GST, direct tax fraud

‘Mitron…’, the endearing salutation that Prime Minister Narendra Modi used earlier than dropping the cash ban bombshell in an address to the state on November 8, 2016, later come to be a metaphor for unsightly surprises. All through Modi’s closing tenure, speculation was rife that the subsequent time Modi utters ‘mitron’, he’s going to ship the newly-delivered Rs 2,000 foreign money notes out of the move.
As the brand new government units sail, one prominent market analyst on Friday speculated that Modi might go for some hard selections early into his 2nd innings and the demonetization equal this time around could be a primary crackdown on indiscipline in tax fee.
A Finance Ministry movement in advance this week in opposition to over a dozen income-tax officers for alleged corruption and professional misconduct has given upward push to conjectures and theorizations that a crackdown against tax evasion is inside the offing.
“I am quite positive that is happening. We are going to see a chief tax crackdown, mainly on GST, and to a degree, at the direct taxes aspect as well,” Saurabh Mukherjea, Dalal Street veteran and founder of Marcellus Investment Managers, said in an interview with ETNOW.
The authorities dismissed 12 senior income-tax officers on costs of corruption and expert misconduct on June 10 and observed it up with every other spherical of easy-up on June 18, while 15 senior profits-tax officials, accused of corruption, were made to compulsorily retire.
Those sacked included officers in the ranks of fundamental commissioners, commissioners, extra commissioners, deputy commissioners, joint commissioners, and assistant commissioners.
Some of them were allegedly extorting businessmen, at the same time as others were determined to have obtained vast movable and immovable belongings in the call of self and family participants. The retirement turned into ordered underneath Rule fifty-six (j) of the General Financial Rules of Central Government Services.
The action came within days of the Modi government kicking off its 2d time period. “The first thrilling aspect I am seeing over the past two-3 weeks is everyday information waft approximately senior tax officers being asked to retire or depart. That is suggestive of the main tax crackdown, and I had anticipated this before the election,” Mukherjee said.
Government watchers say the flow sent out a strong signal about the Modi regime’s motive of cleansing up the device at a time when sluggish tax revenue increase has tied government hands in pushing its time table for growth.
“By invoking a rule that has seldom been used, the Centre has sent out a stern warning to tax sleuths of 0 tolerance in the direction of graft. The root purpose of corruption the misuse of arbitrary powers bestowed at the tax administration. That ought to cross,” Economic Times said in an editorial observation.
The cash ban did now not acquire the authorities’ preferred objective of digging out black money, though it provided several fringe blessings. The move became repeatedly mentioned for a number of the political setbacks that Modi’s birthday party suffered in kingdom elections. But a thumping win within the standard elections erased it all.
Mukherjee says the political mandate that the government got is unprecedented in 20-30 years, and it has got to make the most of it inside the first 90 days. “If this monsoon consultation we do now not see fundamental action at the hassle points of the economic system, I might actually worry,” he said.
In its first time period, the government brought approximately a primary coverage change for lateral entry of area professionals into the paperwork. The govt hired 9 joint secretary-ranked officers from the non-public area; which includes an accomplice in KPMG.