These are some of the measures Economic Survey 2019, authored by Chief Economic Adviser Krishnamurthy Subramanian, has suggested to improve tax compliance in the country. The survey said that research across countries has highlighted that tax evasion is driven significantly by tax morale - the intrinsic motivation of taxpayers in a country to pay taxes. Citizens perceive vertical fairness to be low, the Economic Survey said, if they find their tax payments being squandered in wasteful public expenditure or by corruption. To correct vertical unfairness that can lead to tax evasion, the survey said, the government should utilise the behavioural insight that people identify with their neighbourhood. This may take the form of expedited boarding privileges at airports, fast-lane privileges on roads and toll booths, special “diplomatic" type lanes at immigration counters, etc.

Source: Mint July 04, 2019 09:45 UTC