Parliamentary Panel Report: One-Third Vacancies in CBDT and CBIC
A recent parliamentary panel report has uncovered a significant workforce shortage in two of India’s premier tax authorities—the Central Board of Direct Taxes (CBDT) and the Central Board of Indirect Taxes and Customs (CBIC). Alarmingly, nearly one-third of sanctioned posts remain vacant, which could severely impact the efficiency of tax administration and taxpayer services.
Key Findings
Widespread Vacancy Rates
The report highlights substantial vacancy rates in both boards:
- CBDT: Of the 78,000 sanctioned posts, only 50,000 positions were filled as of September 1, 2024, leaving a staggering 36% vacancy rate.
- CBIC: Out of 84,000 sanctioned posts (excluding SEZs), only 52,000 positions were occupied, resulting in a 38% vacancy rate.
Critical Positions Left Unfilled
Certain key posts, such as the Inspector of Central Excise, face a complete 100% vacancy, with 7,744 positions unoccupied. This alarming statistic indicates severe operational inefficiencies, directly affecting the smooth functioning of the departments and taxpayer services.
Recruitment Challenges
High Attrition Rates
The panel emphasized that high attrition rates continue to plague these departments, as candidates frequently leave for better opportunities in other sectors.
Delays in Recruitment Processes
Recruitment largely depends on external agencies like the Staff Selection Commission (SSC) and the Union Public Service Commission (UPSC), which has led to significant delays. Consequently, positions remain vacant for prolonged periods, exacerbating the issue.
Efforts to Address Vacancies
Recruitment Initiatives
The Revenue Secretary acknowledged the vacancy crisis and highlighted ongoing recruitment efforts. While some progress has been made, the process remains challenging and requires sustained coordination with recruitment authorities.
Challenges in Implementation
Although the government has initiated measures, the slow pace of recruitment continues to hinder efforts to fill these gaps effectively.
Tax Arrears: A Growing Concern
The report also shed light on the alarming accumulation of tax arrears, which has further compounded operational challenges:
Increasing Tax Arrears in CBDT and CBIC
- CBDT: Cumulative arrears surged from ₹10 lakh crore in 2019-20 to over ₹42 lakh crore as of October 7, 2024.
- CBIC: Arrears rose from ₹3.02 lakh crore in 2021-22 to ₹4.26 lakh crore in 2023-24.
Recovery Challenges
Approximately 85% of indirect tax arrears and 65% of direct tax arrears are deemed difficult to recover, underscoring the urgent need for stronger mechanisms to address these pending amounts.
Recommendations from the Panel
Expedite Recruitment
The panel recommended fast-tracking recruitment processes to ensure efficient tax administration and better taxpayer services. Filling 100% vacancies in critical posts, such as Inspectors of Central Excise, should be prioritized.
Strengthen Retention Policies
Developing incentives and career advancement programs is essential to reduce attrition and retain skilled talent within the department.
Improve Recovery of Tax Arrears
Streamlining processes and strengthening mechanisms to address pending arrears can significantly improve recovery rates and reduce the burden of uncollected taxes.
Implications
The combination of high vacancy rates and increasing tax arrears underscores the urgent need for structural reforms in recruitment and retention policies within the CBDT and CBIC. By addressing these issues promptly, the government can enhance operational efficiency, improve taxpayer services, and better support India’s growing economic demands.
