The Hindu Business Line : Load on taxman eased

The enhancement of the income-tax exemption limit to Rs 1.5 lakh and the upward revision of the tax slabs beat the average expectations of the taxpayer.

Every individual will get a minimum tax relief of around Rs 4,000.

The tax administrator can also heave a sigh of relief. The number of effective assesses, of individuals, HUFs and firms, will get drastically reduced.

The tax department can now concentrate on more efficient and effective work. The Department has been disposing of about 2.61 crore tax assessments every year.

Now that this workload will is likely to reduce, much more will be expected from the assessing officer (AO). The cost of collections is already going down and stands at 0.74 per cent of the total collections. It is likely to go down further.

Anti-evasion measures

The Permanent Account Number (PAN) is now mandatory for all financial transactions.

The scheme for making prima facie adjustments so as to make summary assessments without calling for the attendance of the taxpayer is now brought back.

The AO, as per the amendment to Section 143 of the I-T Act, can correct arithmetical mistakes in the return. Adjustments to the income returned will be made only in the case of computerised processing without any human interface.

The I-T department is in the process of establishing a system for Centralised Processing of Returns. Software will be designed to detect arithmetical inaccuracies and internal inconsistencies and make appropriate adjustments in the computation of the total income.

Due date for filing of returns for companies will henceforth be September 30 instead of October 31.

Tax administrators will be relieved that the Banking Cash Transactions Tax (BCTT) is now withdrawn. It will help trim the direct tax law. But in comes the Commodities Transactions Tax (CTT). This will be on the same lines as STT on options and futures.

Will the tax administration be more efficient and taxpayer friendly? The Finance Minister’s optimism seems justified.

(The author is a former Chief Commissioner of Income-Tax.)

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