A Step Closer To Complete Tax Transparency, PM To Inaugurate Tax Transparency Platform

By Angel Broking | Published on 14th August 2020 | 64

A Step Closer To Complete Tax Transparency, PM To Inaugurate Tax Transparency Platform

Calling it an endeavour to Honour the Honest – Transparent Taxation is a platform which aims at simplifying direct tax norms to help bring transparency to the system and reduce taxpayers’ woes. In a virtual event, PM Narendra Modi will inaugurate the platform on August 12. Several chambers of commerce members, trade associations, chartered accountant associations, and eminent taxpayers will attend the event.

In recent time, the Central Board of Direct Taxation has carried out several policy reforms to make the tax payment and administration system more transparent to improve tax collection and reduce evasion. It included several policy reforms regarding lowering tax rates, the abolition of dividend distribution tax, and the introduction of Document Identification Number or DIN. Last year, the board lowered the corporate tax rate from 30 percent to 22 percent, and reformed tax regulations for new manufacturing units and start-ups.

The new Document Identification Number will bring transparency in official communication where all communication from the department will carry a unique computer-generated identification, helping in tracking chains of conversations and maintaining records.

Why Is Direct Tax Reform Needed?

In India, the Central Board of Direct Taxes is the responsible body for the administration of direct taxes. As the name suggests, a direct tax is paid directly to the government. There is a long list of direct taxes that are collected from the taxpayers on different occasions.

The Indian tax system is complex, and GDP-tax ratio is significantly low. To curb this issue, the government has carried out several reform actions to improve tax administration, reduce evasion, and simplifying tax payment and management. Launching Transparent Taxation Platform – Honouring the Honest is a step towards simplifying the compliance process and rewarding honest taxpayers.

Key Points About The New Platform

  • The government is trying to rebuild the pandemic hit economy by simplifying the compliance process, encouraging the digital filing of IT and payment
  • Transparent Taxation platform launch will carry forward the tax reform initiative undertaken by the government
  • The new platform will make the faceless assessment, faceless appeal, and taxpayers’ charter feasible
  • Faceless assessment and taxpayers’ charter will implement from August whereas, faceless appeal facility will start from September 25
  • The new platform will enforce seamless, painless, and faceless tax payment which will bring more transparency and faith to the system
  • The honest taxpayers play a quintessential role in building the country, and the new system will make their life easier
  • Taxpayers can now be assured of fair evaluation and faster resolution of appeals. The IT department now has to treat each taxpayer’s dignity with sensitivity – said, PM Modi
  • The new taxpayers’ charter, announced by the Finance Minister during 2020-21 budget, will instil trust between the taxpayers and the administration
  • The platform will assist the faceless tax assessment process, introduced by the Central Board of Direct Taxes, the apex decision making body in direct tax matters, last year. In the new regime, both the taxpayer’s identity and the evaluator’s identity will remain undisclosed
  • The government is also planning to introduce cashback and other rewarding systems under GST payment to encourage the digital method of tax payment

Conclusion

The Indian tax system is complex, and where there are complexities, there are issues with compliance. Since 2014, the government is making constant efforts to revamp the current tax system and curb harassment of honest taxpayers in the hands of tax officials. The new platform will make tax filing easier for the assesses and facilitate faceless tax assessment which the government is trying to promote.