Govt plans to set up mechanism under which it can make an entity with Rs 2 lakh transaction comply with law.
Mumbai: Like Aadhaar, the 12-digit biotmetric based identity issued compulsorily to every Indians, the government is planning to make PAN, a 10-digit alpha numeric number, mandatory for businesses and non-governmental organisations, a report in The Times of India said.
The report adds citing some unidentified sources telling TOI that for the purpose Corporate Ministry has backed amendments to the Income Tax Act. MCA has also supported some changes made in the Prevention of Money Laundering Act to make PAN compulsory for identified entities.
As part of its massive crackdown on black money, tax evasion, unaccounted wealth, counterfeiting and unhinged political funding, the government has taken a slew of measures to stop recurrence of these illegal activities. It has also mandated linking of Aadhaar with PAN a compulsory exercise, which will lead to cancellation of PANs if holders fail to link both the crucial documents.
The government also wants to set up a mechanism under which it can make any entity that has a cumulative annual transactions of over Rs 2 lakh to comply with law. Tax authorities have already issues PAN cards to many companies, businesses, trusts and individuals. So far, the I-T department has allotted more than 25 crore PAN cards in the country, a number which is 20 per cent of India's 125 crore population.
Through the new stricture, tax authorities want to keep track of individuals who are directors or promoters of companies and discourage them from holding or owning benami properties.