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Karnataka's Commercial Taxes Department has adopted an e-payment system developed by the Reserve Bank of India (RBI), Bangalore, for remittances of taxes.
The new e-payment system helps one remit taxes anywhere and anytime. The system is beneficial to the State Government also as the payment is realised immediately, as against several days in the old system.
Every month on an average one lakh cheques are received by the Commercial Taxes Department. This involved a huge amount of manual work and at the same time delayed realisation of amount, especially when some cheques bounced.
“The Commercial Taxes Department collects more than Rs 2,000 crore per month and in the past, these collections were by way of cheques paid by the tax payers,” said Mr Pradeep Singh Kharola, Commissioner, Commercial Taxes Department. Now with a new e-payment system called ‘EASeR' tax-payers can remit money through Internet bank accounts from any place any time.
Six banks have been enabled to participate in the tax collection process. They are State Bank of India, State Bank of Mysore, State Bank of Hyderabad, Canara Bank and Union Bank of India. EASeR currently facilitates following taxes — Value-added Tax, Karnataka Sales Tax, Central Sales Tax, Karnataka Tax On Entry Goods and Professional Tax. Shortly other taxes like Luxury Tax, Entertainment Tax and Betting Tax will also be added to the system.
The new system which was running on trial for an year was launched on Thursday by the RBI's Deputy Governor, Ms Shyamala Gopinath. Speaking after launching the system, she said, “During the past four years, there had been a paradigm shift in transaction and the e-payment system helped in quick clearance of cheques and drafts. The new system, which was trendsetter, was introduced by RBI in collaboration with the State Government and if it succeeded, it would be introduced in other States,”.
In his address, the Karnataka Chief Minister, Mr B.S. Yeddyurappa, said there is a healthy trend in tax collection in the State and this new system would facilitate to be more efficient. “The new system is tax-payer user-friendly and would also help the Department to curb tax evasion,” he added.
How it works
Explaining how the new e-payment system works, Mr Kharola said, “Each day at 8 pm evening, the participating banks who have received the remittances from the tax-payers will upload the
transaction files with transaction details to the RBI Web (site). RBI, Bangalore, will in turn download the files and process it using their in-house system and accordingly debit the respective banks and the credit the State Government account.”
“Later these transactions will be uploaded by the RBI to the reconciliation Web site of the Commercial Taxes Department. The remittance from the tax-payers will reach the Government directly
through RBI,” he added.
Through this system, the RBI, Bangalore, has facilitated convergence of remittance and reconciliation. Mr Kharola said, “Later the treasury will access information processed by RBI from the Web site and process it in their system and assign challan numbers to each transactions and once again upload back to the reconciliation Web site.”
“The Commercial Taxes Department, thus, will have the entire track of the tax remittances made by any tax-payer till the realisation takes place,” he added.
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