My beloved Members,

I Taxing Returns and I-T Department to Target Tier-Ii Cities, Towns

Taxpayers dream of ‘Saral’ tax returns and receiving efficient services from the Dept. is not on the ‘Agenda’ of the CBDT. So sad is the situation ! In less than a decade ‘Saral’ tax return forms have moved from a single page to a bundle of over dozen sheets. This year, the proposed return forms contained 14-pages and got more complicated. Thus, the authorities had made several additions to the I-T return form, seeking details about foreign travel and all bank accounts held in India at anytime during the previous year. Obviously, across the country there was a hue and cry about such introduction of I-T return forms. The widely accepted principle of simplicity in procedures / compliance is almost given a good bye ! The root of the problem is failure to harness the potential of information technology. If it can be harnessed for processing the other kind of I-T not only will taxpayers benefit, it will also reduce incidence of black money. Across the world, tax administrations are using technology to make life simpler for taxpayers. For example, inspired by efforts of Nordic countries, a diverse array of countries such as South Africa and Turkey have introduced pre-filled tax returns. Here, tax administrations used technology to track transactions of taxpayers and sent them completed or largely finished tax return forms. Consequently, they make life simpler for the taxpayer. In our country too, this is easily doable with salaried taxpayers, to begin with. But seldom such initiative will be taken by the I-T Dept. Who will awake them up ?

Notwithstanding the above, after uproar on the issue across the country, Govt. has decided to simplify new I-T return form to mitigate the difficulties of the taxpayers. So let us wait and watch what is in store for compliance for the taxpayers.

II Widening the Tax Net

Anita Kapur, Chairman, CBDT, directed the authorities down below to double the taxpayer’s base to 6 crore by the end of current financial year i.e. 2015-16. At present, the number of assessees are nearly 3.5 crore, of which around 2.5 crore are individual taxpayers. “In the present scenario, the above task allotted to the authorities is a herculean one to comply with inasmuch as, the strength of the working staff is pathetic. We have written to the CBDT via Chief Commissioner of Income Tax. If they do not heed, we will go on a protest,” General Secretary of the I-T Gazetted Officers Association said. According to the CBDT Chairperson, the action plan in this behalf will be one of the top priorities, to be discussed at the Annual Tax Conference of Senior Tax officials scheduled to be held on 25-26 May, 2015 at New Delhi.

III CAG’s observations on Payment of Interest on I-T refunds

The I-T Dept. has incurred an expenditure of
Rs. 42,903 crore on interest payments on refunds during the 6-year period ended 2013-14 without approval of Parliament, official Auditor CAG said. CAG in its report, said as in the past, the Budget for 2013-14 has not made provision for interest on refunds and an expenditure on refunds amounting to
Rs. 6,598 crore was incurred by CBDT, in contravention of the provisions of the Constitution. So this legal tangle is for the Govt. to resolve, but the fact is that refunds are inordinately delayed and the taxpayer is entitled to interest as provided in the I-T Act.

IV FM sticks to April 2016 deadline for gst

The Finance Minister Arun Jaitley said on 14th May, 2015 at Delhi that deadline for rolling out GST would be met though there was a lot of unfinished work, which had to be completed during the monsoon and winter sessions of Parliament. Meantime, FMCG companies are unhappy with the GST in current form inasmuch as, 1% of additional tax on inter-State Goods Movement as well as stock transfers is a major concern pertaining to Clause 18 of the Bill. Mr. Harish Manwani, Chairman, Hindustan Unilever Ltd. said: “Whatever issues are there at an industry level, we are working very closely with the authorities and the Government to make sure there is a smooth implementation of GST.” Simultaneously, P. B. Balaji, CFO of HUL said “the whole 1% of additional tax proposed for sales (inter-State) as well as stock transfers was never in the scheme of things and an area of concern”. According to him, it is not in the spirit of GST. Therefore, time alone will decide the fate of introduction of GST levy.

Notwithstanding the above, as per TOI report dated 18-5-2015, the FM assured reasonable taxes, is of business being the top priority for the second year of the Modi government. The Modi government plans to roll out a common GST by April 1, 2016 while corporate tax rate would be brought down to 25% from 30% over a period of 4 years on the direct taxes.

Last but not the least, many of you may be enjoying summer vacation currently, but may I remind you that AIFTP and associated organizations have chalked out many programmes as a continuing education in the month of June-July 2015 for you to update your knowledge and skills in the respective area of your practice. So, please do attend the same in large numbers !

With best wishes and regards,

J. D. Nankani
National President

Posted in May.

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