The computerisation of commercial taxes is yet another e-governance project of the Government of Karnataka (GoK). The Commercial Taxes Department (CTD) has set up an ‘Intelligence Investigation Vigilance’ wing that will monitor all border check posts and ensure that goods vehicles passing through the state are registered for taxes and filing of returns, and have a valid statement of commodities. Important check posts are being computerised. All invoices will be scanned at computerised check posts and dealers will make transaction details available to assessing officers who will check for tax evasion on commodities.

V Madhu, who is the commissioner of commercial taxes in the Government of Karnataka says, “50 percent of the goods Karnataka consumes come from other states. The commercial tax department earns Rs 6,800 crore in revenues from sales tax per annum from the manufacturers alone.”

The CTD started this project in mid-2000 but it took time to take off because of technical problems. The contract was given to National Informatics Centre Services Incorporated (NICSI). They are to provide the necessary hardware, software, VSAT links and networking. NICSI will also be training the assessing officers.

Technical hurdles: The CTD wanted to get information about commodities being brought into the state, exported outside and passing through Karnataka. Says Madhu: “We collect 15 million documents annually from across the state. Checking each document for tax compliance is laborious and time consuming. Commodity dealers were taking advantage of loopholes and avoiding taxes in the absence of online data.”

Earlier, in the manual system, it used to take 40 to 60 days for documents to reach the head office from a check post. Post implementation, the process takes less than an hour and the CTD can curb tax evasion. The department has computerised details of close to one lakh dealers.

The Intelligence Investigation Vigilance wing has identified 30 check posts, which will be computerised and networked using VSATs. Madhu says, “During phase one, nine check posts have been computerised, including Hosur, Tumkur, Mysore, Thokkattu, Nippani and Bellary. While 80 percent of the work is completed, the total cost of the project is estimated to be Rs 1.28 crore.” Currently all these check posts send data via e-mail to the CTD head office in Bangalore using dial-up connections. By October 2002, STPI will link all check posts using VSATs. A data centre is planned that will be located at the CTD head office.

Each check post has a Wipro NetPower Pentium III with 256 MB RAM running Windows 2000. A five-user license of MS SQL Server has been obtained for each post. “There are five Wipro SuperGenius Pentium III systems connected to the server. We are planning to add another three PCs at each check post this year.” Each check post has a Wipro LQ1050+DX printer.

During the next phase, the CTD is planning to network another 15 check posts for computerisation.