Why is Govt Desperate to Make Aadhaar Compulsory For I-T Returns?

Why is the Aadhaar being forced on people who already have an ID for filing taxes?

Why is Aadhaar being forced on people who already have an ID for filing taxes? (Photo: The Quint)

Why is the Indian government so desperate to bring all citizens under the Aadhaar? What is this extreme urgency to force everyone to get an Aadhaar, while the Supreme Court is yet to take a call on the constitutionality of the system? Why the sneaky tactics?

The Union Government introduced amendments to the Finance Bill 2017 at the last minute, making Aadhaar mandatory for filing taxes. The amendments state: “Every person who is eligible for an Aadhaar number shall, on or after the 1st day of July 2017, quote Aadhaar number,
(i) in the application form for allotment of the permanent account number
(ii) in the return of income”

Failure to do so can also result in the government cancelling the user’s permanent account number (PAN).

These amendments were not a part of the Union Budget announcement. Instead, they were sneakily slipped in on 21 March. The Finance Bill on the Indian Budget website makes no mention of Aadhaar.

On 22 March, the Finance Bill was passed in the Lok Sabha.

Also Read: Demonetisation, Aadhaar, and the Great Rural ID Theft

Why Make Aadhaar Mandatory for Tax Returns?

What is the point of a PAN number then? What the government of India is trying to do is to take multiple IDs and combine them under a single identity number, so that all other historical IDs become redundant.

However, as is evident, the PAN number isn’t going anywhere: it will still be required for tax filings. So the Aadhaar is basically just another layer of identification mechanism over an existing one. If the idea behind the Aadhaar was to give everyone an ID, why is it being forced on people who already have an ID for filing taxes?

As an opinion piece in the Financial Express last month pointed out: “Of a total of over 24 crore PANs, the latest data indicates that only 97,33,664 have been linked to Aadhaar through e-returns”. The author opined that linking Aadhaar to PAN will “be a big source to gather banking transaction information, which can be an important indication of a person’s income profile.”

So, to put it simply:

The push to go digital forces everyone to use accounts to make payments. Linking the Aadhaar to the PAN and to bank accounts enables the government to compare tax filings with bank accounts and payments.

An additional benefit is that the Income Tax department will be able to profile citizens according to their spending behaviour. Unless of course, there are legal provisions to prevent this. But for that, we’ll need a privacy law.

Here are a few issues surrounding the Aadhaar that need to be resolved immediately:

1. Violation of SC Guidelines

The push for Aadhaar is in clear violation of the Supreme Court order to refrain from making the ID mandatory, save for a few services. The apex court is also yet to determine the constitutionality of Aadhaar and is still to take a call on whether privacy is a fundamental right.

It’s worth noting that the Aadhaar fails to guarantee privacy, and allows for mass surveillance of citizens under the guise of “national security”, a term which is vague and undefined under law. Citizens have no recourse under the law, and Section 47 of the Act prescribes that only the UIDAI can file a criminal complaint for theft of data.

What is this but contempt of court? The Supreme Court of India appears to be turning a blind eye to the government’s violation of its order. Are laws and orders only valid when the SC chooses to enforce them?

Why the rush? Here’s a guess: By the time the government is done getting everyone under the Aadhaar by making it mandatory, the SC ruling will be redundant. Therefore, the Aadhaar will remain because it will become too big to fail and too much money, time and effort will have been spent on it already.

Also Read: If Your Aadhaar Data Has Been Hacked, You Might Never Find Out

2. The Issue of the Single Identifier and Linked Databases

Unlike the US Social Security Number, the Aadhaar is being used as an identifier to link databases, which makes it easy for government officials to gain access to personal user information – such as bank records, education data, health records, and for surveillance of phone calls and data usage.

Until the Aadhaar, this data was not linked. But now, schools are now mandating Aadhaar numbers, banks are pushing customers to get one and the SC has asked the government to link the Aadhaar with mobile numbers.

3. The BJP’s U-Turn on Aadhaar

Let’s not forget, PM Narendra Modi had publicly criticised the Aadhaar in 2014.

Note that the Aadhaar was missing from the BJP’s election manifesto. Now it appears to have become the ruling party’s main focus.

4. No Privacy Law in India

India does not have a privacy law. Attorney General Mukul Rohatgi had argued about this in Supreme Court. “Violation of privacy doesn’t mean anything because privacy is not a guaranteed right,” he said.

In the absence of a ruling, someone needs to file a petition in the SC, seeking a stay of its operations, to at least momentarily halt the expansion of the Aadhaar’s mandate.

(This article first appeared on Medianama.com and has ben republished with permission. The author, Nikhil Pahwa, is the founder of Medianama.)