Indian citizens to pay taxes and obtain ID numbers in minutes via smartphone app

The Indian government is developing the app as part of its wider ‘Digital India’ programme. 

As part of the Indian government’s wider ‘Digital India’ programme, it has started developing an app to enable citizens to both pay their taxes and apply for a permanent account number using their smartphones.

The aim of the Digital India initiative, which was introduced by Prime Minister Narendra Modi in July 2015, is to provide rural areas with high-speed internet access and improve digital literacy in order to stimulate the take-up of electronic products and services, boost electronics manufacturing and create IT jobs.

The Central Board of Direct Taxes (CBDT) is responsible for building the new app, which will enable citizens to apply for permanent account numbers (PAN) and have them issued in near real-time. They will also be able to pay taxes online and undertake a range of other services such as tracking returns.

Individuals’ identities will be verified using standard electronic ‘Know your customer’ (e-KYC) processes based around the Aadhaar 12-digit unique identity number, which is issued to all Indian residents based on their demographic and biometric data such as thumb prints.

The aim of digitising the process is to make it easier for citizens to get hold of a PAN in a bid to ensure that more people are covered by the tax net. PANs are 10-digit alphanumeric codes issued by the Income Tax department in the form of a laminated card in order to facilitate information tracking and retrieval and to detect and combat fraud. It is mandatory to quote the PAN code on any income tax return form or correspondence with the tax authority.

A government official told The Economic Times newspaper: “If a SIM can be issued through e-KYC, then the same can be done for a PAN,” adding that the goal was to reduce the time the process takes from the current two to three weeks to five to six minutes. Although the number will be provided almost immediately, the actual PAN card itself will be sent through the post at a later date.

The CBT is also working with the Ministry of Corporate Affairs in a bid to ensure that PANs are issued to newly incorporated companies within four hours to act as business identification numbers.