PAN 2.0: Will it be more like income tax Aadhaar? Know how it will impact the individual taxpayers and businesses
The government is spending Rs 1435 crore for upgrading the existing permanent account number (PAN) infrastructure to help improve services for taxpayers and corporates. This new project dubbed PAN 2.0 is set to be launched soon and has already received approval of the Cabinet Committee on Economic Affairs (CCEA).#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;} Union Minister Ashwini Vaishnaw said in the announcement event, "PAN cards are very important for the middle class, small business and others. It is decided to completely overhaul the entire digital backbone of the PAN system and highly upgrade it. The software which is now running the existing system has been running for 10 to 15 years and their life is now over. Hence the need for a new information technology system was felt. PAN 2.0 will be complete paperless, online and the complete focus will be on the grievance redressal system of the user."
Also Read: PAN 2.0: New PAN card to have a QR code, will your current PAN card become inoperative?
How new PAN 2.0 project benefits taxpayers
According to the press release by the Ministry of Finance: the PAN 2.0 Project enables technology driven transformation of Taxpayer registration services and has significant benefits including:Ease of access and speedy service delivery with improved quality;Single Source of Truth and data consistencyEco-friendly processes and cost optimization; andSecurity and optimization of infrastructure for greater agility.
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"PAN 2.0 Project is an e-Governance project for re-engineering the business processes of taxpayer registration services through technology driven transformation of PAN/TAN services for enhanced digital experience of the taxpayers. This will be an upgrade of the current PAN/TAN 1.0 eco-system consolidating the core and non-core PAN/TAN activities as well as PAN validation service. The PAN 2.0 Project resonates with the vision of the Government enshrined in Digital India by enabling the use of PAN as Common Identifier for all digital systems of specified government agencies," said the Ministry of Finance in the press release.
What appears from the information available so far is that PAN 2.0 is more like an upgrade to the IT system on which PAN architecture was running. The intended goal is to enhance its digital utility in terms of deduplication, cross section verification and seamless authentication. It is unlikely that existing PAN holders will need to apply again as the new system will largely have an impact on the new applicants once upgraded.
ET Wealth Online has asked various experts about what benefit might the new PAN 2.0 project give taxpayers. Here's what they said:
Mihir Tanna, associate director, S.K Patodia LLP, a CA firm: It is likely to merge registration requirements of different laws (governed by central) like PAN, GST, CIN issued by MCA etc. The government has said that Unique numbers (UIN) will be given to all including businessmen and professionals. As of now when a new company is formed, PAN is also issued and there is no requirement of filing PAN application separately. Similarly, under PAN 2.0 we can expect that once a new person/entity applies for registration, a UIN will be issued which can be used for Income tax, GST, MCA compliances. Respective department verification is likely to be continued for new persons/entities like income tax will check if PAN is already issued or not to the same applicant, the GST department will check if the applicant is actually involved in declared goods or services. However, if UIN is going to replace CIN, we need to wait for more clarification from government as currently 2 entities with same name can get PAN (if other details like address, DOI is different) but company applying for registration will not get same name if any other company already exist with similar name.
Also, for all existing holders of PAN, GST, CIN is likely to be converted into new system of PAN 2.0 if they are involved in any business or profession, We can also hope that under PAN 2.0 unique number will be issued in a faster way as everything will be in digital form (unlike PAN application which currently can be filed offline also). To summarise we can expect that it will be like Aadhaar for all businesses and professionals
Chartered Accountant Ashish Niraj, partner, ASN & Company: Prima facie it looks like a lot of features of Aadhaar is going to get incorporated in PAN 2.0 project. Moreover, the government has said that PAN 2.0 will have a QR (quick response) code which will be provided at no additional cost to existing users and new users may also be served as a Common Identifier for all digital systems. I believe that this will help give clarity to taxpayers and also help save them time and money. Moreover the new PAN 2.0 also have certain advanced security features incorporated in it which will strengthen taxpayer's confidence in it.
Deepak Chopra, chairman, direct tax committee, Karnataka State Chartered Accountants Association (KSCAA): The PAN 2.0 project is a welcome step towards leveraging technology to simplify and streamline taxpayer services. Its success, however, will depend on how well the transition is managed, ensuring minimal disruptions to existing systems. Proper testing and user-friendly interfaces will be critical to achieving the intended outcomes. While the allocated Rs 1,435 crore signifies the government's commitment and confidence in the project's benefits, taxpayers and professionals alike hope that the implementation is efficient, transparent, and delivers long-term value. We remain optimistic that it will deliver on its promise of improved service delivery and efficiency.
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This story originally appeared on: India Times - Author:Faqs of Insurances
