The government of India has been linking PAN (Permanent Account Number) with Aadhaar, which is a unique identification number issued by the Unique Identification Authority of India (UIDAI), to prevent tax evasion and to simplify the income tax filing process. Here are some reasons why the government is linking PAN with Aadhaar:
- Preventing tax evasion: By linking PAN with Aadhaar, the government can identify cases of individuals who have multiple PANs or use fake PANs to evade taxes.
- Simplifying income tax filing: The government can simplify the income tax filing process by using Aadhaar to pre-fill personal information in the income tax return form, such as name, address, and date of birth, making the process more efficient.
- Ensuring accuracy of personal information: Aadhaar is a biometric-based identification system, which means that it is more accurate and reliable than other identification documents, such as voter ID or passport.
- Facilitating financial transactions: Linking PAN with Aadhaar can also make it easier for individuals to open bank accounts, apply for loans, and make financial transactions as their identity can be verified electronically.
- Meeting legal requirements: The government has made it mandatory for individuals to link their PAN with Aadhaar to comply with the provisions of the Income Tax Act.
It is worth noting that the government has faced criticism for the mandatory linking of PAN with Aadhaar, with some arguing that it violates the right to privacy and could lead to misuse of personal data. However, the government has maintained that the linking is necessary to prevent tax evasion and ensure accurate identification of individuals.
