Income Declaration Scheme 2016 and
Direct Tax Dispute Resolution Scheme, 2016 –
Assessees must take advantage of these schemes – Tax administration must
interact with tax associations/bodies and tax professionals to achieve the
desired objectives of these schemes, rather than spending honest taxpayer
money on advertisement of the schemes
The Finance Act, 2016 has introduced two schemes viz., the Income Declaration Scheme, 2016 and Direct Tax Dispute Resolution Scheme, 2016. The purpose behind introduction of these schemes is laudable. Their success depends upon the confidence that the Government is able to inspire among tax consultants who are the first points of contact for any assessee’s tax issues and grievances.
Till date, though more than 16 schemes have been introduced from time-to-time, it is for the first time that the Honourable Prime Minister of India has assured the declarant of the Income Declaration Scheme of complete confidentiality. The Honourable Finance Minister is also interacting with tax professionals and making a sincere attempt to make the schemes successful. We as tax professionals will have to play a proactive role to advise the assessees by explaining the advantages of these schemes.
One of the advantages of the Income Declaration Scheme is possible regularisation of properties in Benami name. There is no liability of interest or penalty under the direct taxes in addition to peace of mind for assessees. The Government has shown a positive mindset by issuing clarifications from time-to-time. Even for the payment of tax, installments have been granted. We hope the assessee will be able to take advantage of the schemes.
Towards better understanding of these schemes, the Federation has requested experts to share their knowledge so that the tax practitioners can advise assessees properly on these issues. The learned authors have explained the salient features of the schemes wherein they have answered 60 FAQs. All the FAQs, text of the schemes and questions and answers by the CBDT are also posted on www.itatonline.org.
I am of the opinion that spending taxpayers’ money on advertisement of these schemes may not earn the confidence of the assessees, who would rely on the advice of the tax consultants alone. If tax administration interacts with tax bodies/associations and tax professionals to spread awareness about these schemes, this would in turn go a long way in making these schemes a success.
Dr. K. Shivaram