The government’s move to make PAN mandatory for salary earners primarily intends to track revenue leakages. By making PAN mandatory, the government will be able to track the actual amount of tax that an individual has been paying out of his or her earning.
As per government statistics, almost 900,000 individuals have taken PAN from the government.
Though officials at the Inland Revenue Department (IRD) claim that making PAN mandatory for all salary earners is a part of strengthening the tax administration and controlling revenue leakages, the private sector has been urging the government to defer the plan.
“Though making PAN compulsory for government workers is logical, it is difficult to make it mandatory for all workers working for private firms.
Moreover, thousands of Indian workers are involved in different projects, especially related to infrastructure and making Permanent Account Number mandatory for such workers is not possible,” said an industrialist seeking anonymity.
A version of this article appears in print on July 17, 2019 of The Himalayan Times.