The Union Cabinet on Thursday gave nod for a major revamp of the income-tax (I-T) department, paving way for recruitment of more than 20,000 additional tax officials in the coming two years.

The approval will allow the recruitment of 1,349 additional I-T officers in the Indian Revenue Services cadre and 19,402 personnel in the non-IRS cadres.

The increase in the number of officers will make the process of tax refunds speedy and bring more people under the tax net. The revamp is expected to help generate additional revenue of Rs 25,000 crore per annum.

Speaking on the topic, Union Finance Minister P Chidambaram said, "Cabinet has approved creation of 20,751 additional posts in I-T Department as part of revamp... This will help generate additional revenue of
25,000 crore annually."

Mr. Chidambaram also said that the move would help the I-T Department provide tax payers with better services.

The Cabinet also decided that chief commissioners of bigger zones as well as heads of various directorates under the CBDT (Central Board of Direct Taxes) would be eligible for the rank & pay of special secretary.

In the current financial year, the government aims to collect more than Rs 6.68 lakh crore in the form of direct taxes. In the last financial year, the Rs 5.65 lakh crore were collected via direct taxes.