PM Modi announces charter for fair, courteous tax collection

Andrew Cummings
August 13, 2020

The charter was first mentioned by Finance Minister Nirmala Sitharaman, in her budget speech, when she said that the Central Board of Direct Taxes (CBDT) will adopt a "taxpayers' charter" to ensure trust between a taxpayer and the administration and reduce harassment. Union Minister of Finance and Corporate Affairs, Nirmala Sitharaman and Minister of State for Finance and Corporate Affairs, Anurag Singh Thakur will also present on the occasion.

With reforms like faceless assessment, faceless appeal & taxpayers charter this platform will further strengthen our taxation system, ' said the minister in one of his tweets. The scheme aims to eliminate interface between taxpayer and tax officers. "Dividend distribution Tax was also abolished", it said. Faceless appeal will be applicable from September 25, while faceless assessment and taxpayers' charter will come into force from the very day of launch i.e.

The charter also mandates the department to allow every taxpayer to choose an authorised representative of his choice and provide mechanism for lodging a complain, and its prompt disposal.

The Ministry said exceptions for faceless assessment and appeal are cases relating to serious frauds, major tax evasion, sensitive matters, global tax, and the Black Money Act and benami property.

The reforms include a reduction in corporate tax past year to 22 percent from 30 percent for existing companies and 15 percent for new manufacturing units, and the scraping of dividend distribution tax and faceless assessment.

The charter also bars the tax officers from disclosing taxpayer information unless authorised by law and also respect privacy of taxpayer. "This is the use of the new governance model and the country is getting its results", he said.

The Prime Minister will also unveil the next phase of direct tax reforms aimed at easing compliance and rewarding honest taxpayers in a bid to rebuild Indian economy, which has been hit by the coronavirus pandemic and the resultant lockdown. In all the efforts that have been taken in the last 6-7 years, we have seen that the number of people filing the income tax return has increased by 2.5 crore. "Several initiatives have been taken by the CBDT for bringing in efficiency and transparency in the functioning of the IT department", it said. This includes bringing down corporate tax from 30% to 22% for existing companies and 15% for new manufacturing companies.

The focus of the tax reforms has been on reduction in tax rates and on simplification of direct tax laws.

Compliance norms for startups have also been simplified, it said.

To provide for the resolution of pending tax disputes, the I-T Department has brought out the Direct Tax "Vivad se Vishwas Act, 2020", under which declarations for settling disputes are now being filed. Several measures have been taken to promote digital transactions and electronic modes of payment.

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