Project Insight

You may not have heard about Project Insight, but if you are a serial tax evader the finance ministry is likely to soon have the low-down on you through this exercise.
Insight is the ministry's flagship project, aimed at widening the tax base by catching tax evaders using technology.The ministry has floated a tender worth over Rs.150 crore to buy data analytics software and the infrastructure that goes along with it, a person with knowledge of the matter said. The ministry has also attached a non-disclosure agreement to the tender to keep exact details on the project from getting leaked.
The project is also expected to rank tax evaders based on the amount of tax that could be recovered, so that the authorities could go after the highest value targets first, the person said.
“The challenges faced in widening the tax base are proposed to be handled under `Project Insight' which will leverage data analytics, alert management and case analytics capabilities to prepare case profiles and select appropriate intervention,“ parliament's standing committee on finance said in a report in April.
The project will track the Permanent Account Numbers being quoted on financial transactions and tally them with income tax filings. It is expected to automate a number of processes that took a lot of time in the past and therefore speed up resolution of cases pertaining to tax evasion, the official said.
An advertisement states that representatives of bidders can collect it by submitting a letter of authorisation, a non-disclosure agreement and a prebid integrity pact. The revenue secretary did not respond to an email seeking comment. The Directorate of Income Tax (Systems) has also put out ads for recruiting staff for the project. “The project will integrate enterprise data warehouse, data mining, web mining, predictive modelling, data exchange, master data management, centralised processing, compliance management and case analytics capabilities,“ the directorate said in a letter seeking candidates for the project. As per the letter, the project is likely to have two additional joint commissioners of income tax and six deputy commissioners of I-T.
The ministry also plans to set up a Compliance Management Centralised Processing Centre to handle resource-intensive repetitive tasks, thereby outsourcing the manual aspects of the project to an IT company. “They have been talking about this for some time. Even the last government had talked about it. But they have moved ahead and put out the tender. It will be a complicated deal, so we are still evaluating it,“ said an executive with a technology company, who did not wish to be identified. A pre-bid meeting was held last week, he said.
The government wants to pay the bidders on a per-transaction basis, the person cited earlier said. “Probably not a lot of bidders are going to bid. They are saying they will pay for every account that you create, and some money will be paid for the next five years. You have to invest into it and then collect it over five years,“ he said.
Experts said the terms of the contract could restrict the interest of potential bidders.