Centre trashes IRS officers' report suggesting hike in taxes for super rich, COVID-19 Relief Cess

The government on Sunday rejected a report by 50 Internal Revenue Service (IRS) officers that recommended taxing the super-rich along with other measures to deal with the shortfall on the economy due to the coronavirus.

An official statement was released by the Union Ministry of Finance regarding the matter.

The Central Board of Direct Taxes (CBDT) said that there is some report circulating on social media regarding suggestions by a few IRS officers on tackling COVID-19 situation.

"It is unequivocally stated that CBDT never asked IRS Association or these officers to prepare such a report.  No permission was sought by the officers before going public with their personal views and suggestions on official matters, which is a violation of extant Conduct Rules. Necessary inquiry is being initiated in this matter," read the statement.

(2/3)No permission was sought by the officers before going public with their personal views & suggestions, which is a violation of extant Conduct Rules. Necessary inquiry is being initiated in this matter.@nsitharamanoffc @Anurag_Office

— Income Tax India (@IncomeTaxIndia) April 26, 2020

It also stressed that the impugned report does not reflect the official views of CBDT/Ministry of Finance in any manner.

Terming it as an "irresponsible" act, the ministry distanced itself from the report. 

"An ill-conceived report named 'FORCE' put up by a group of officers through IRS Association giving suggestions on increasing the taxes, etc., in the difficult time of Covid-19 pandemic. The release of proposals in the media through the IRS Association's twitter and the website is "an irresponsible act" of few officers. Neither the IRS Association nor any group of officers mentioned in the said report was ever asked by the Government to give any report on the subject," said the Union Finance Ministry.

Notably, a group of IRS officers had shared a report 'FORCE (Fiscal Options & Response to the COVID-19 Epidemic)' that suggested raising tax rate to 40% for those with income above Rs 1 crore, from 30% at present, and levy of wealth tax for those with over Rs 5 crore annual income.

Almost 50 young IRS officers submit policy suggestions for reviving India's economy, post COVID 19.#IRS: committed to help build Nation's economic immunity.@PMOIndia @nsitharamanoffc @Anurag_Office @FinMinIndia @IncomeTaxIndia pic.twitter.com/vZVqd9HG5S

— IRS Association (@IRSAssociation) April 25, 2020

The report also proposed charging an additional 4 per cent 'COVID-19 Relief Cess' to meet the government's revenue shortfall and contain the coronavirus outbreak.