New Delhi- Finance Minister Nirmala Sitharaman on Thursday said there are no changes in tax rates for direct and indirect taxes, including import duties.
She also said the number of tax filers has swollen 2.4 times and the direct tax collection has trebled since 2014.
The processing time of tax returns has been reduced from 93 days in FY14 to 10 days; and refunds have been made faster, she said.
The government continues to be on the path of fiscal consolidation to reduce the fiscal deficit to 4.5 pc in 2025-26.
She added that the tax base of Goods and Services Tax (GST) has more than doubled since FY14.
Finance Minister Nirmala Sitharaman also announced a significant relief for taxpayers involved in tax disputes. She said that a considerable number of disputed cases are pending, and some even date back to 1962.
To remove the “anxiety of honest taxpayers”, Sitharaman proposed to withdraw outstanding tax demands up to Rs 25,000 in disputed cases pertaining to the financial year 2009-10 and up to Rs 10,000 from FY2010-11 to FY2014-15. She said it will benefit about a crore tax-payers and will help reduce the backlog of disputed tax cases significantly.
The decision comes as a big relief for people, especially senior citizens, who have been grappling with unresolved tax issues ahead of the new financial year and general elections this year.
Disputed tax is the income tax (including surcharge and cess) payable by the taxpayer in a financial or assessment year, as demanded by the tax department under the Income-tax Act, 1961. In 2020, the government launched the tax dispute resolution scheme “Vivad Se Vishwas 2020” in an effort to address the pending income-tax-related cases through this initiative, where the taxpayer only needs to pay the disputed tax to settle the matter.
This means the taxpayer is only required to pay disputed the disputed tax amount, without interest and penalty. Anyone facing a tax demand can pay the tax liability raised to settle the matter. The Income-tax department will pass a conclusive order when payment is made and the matter is settled. The immunity from interest and penalty in a disputed case is a notable benefit.
To alleviate the burden of such issues, the finance minister announced the relief.
She stated, “In line with our government’s vision to improve ease of living and ease of doing business, I wish to improve tax payer services. There are a large number of petty, non-verified, non-reconciled, or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing anxiety to honest tax payers and hindering refunds of subsequent years”, she said.
Commenting on the decision, Anupama Bhargava, a Certified Financial Planner and Partner at Beekay Taxation & Investment LLP, said, “This will result in relief to a large number of tax payers stuck with such unresolved and disputed tax demands.
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