Finance Minister Arun Jaitley has assured that the honest taxpayers have nothing to fear about the new black money law.

Addressing the annual conference of top income tax officials on Monday he said there is sufficient scope to increase tax base. This was necessary as the government wants to increase spending on social sector and infrastructure projects, Jaitley said.

On the new black money law which seeks to bring back the illicit funds stashed abroad, Jaitley said, "no honest taxpayer has anything to fear. It's targeted only against those who have stashed assets abroad."

Black money has to be squeezed without being harsh, he said. "The parallel economy has to be squeezed...and (it) has to be done in very fair manner, not in a harsh manner. In doing so, as senior officers you have to ... maintain the highest standard of integrity," the finance minister told the top officials of the Central Board of Direct Taxes (CBDT).

The government, the minister said, has taken a host of measures to curb the menace of black money. These include passage of the black money law by Parliament and introduction of Benami Transactions (Prohibition) bill to deal with unaccounted domestic wealth.

He sought improvement in tax collection as it will increase the ability of the government to step up spending on social and infrastructure projects and provide relief to individual taxpayers.

He also said that the government aims to bring down corporate tax rate to global levels and will phase out exemptions.

For the current financial year, the minister said, direct tax collection was likely to improve by 14-15 per cent and there was possibility of government improving upon the fiscal deficit target of 3.9 per cent. Last fiscal, direct tax collections has recorded 9 per cent growth.

Revenue Secretary Shaktikanta Das said that direct tax target of Rs 7.98 lakh crore for 2015-16 is very much achievable.