A part from implementing a new income-tax structure with reduced rates and fewer exemptions, the tax department has embraced technology to simplify the tax filing process. Small businesses now face a higher tax audit limit of ₹10 crore (previously ₹ 1 crore), and individuals above 75 years are no longer required to file tax returns.
Glitches in the System:
While the advent of pre-filled forms has undeniably eased the burden on taxpayers, the system has not been immune to glitches. Mass issuance of tax notices, at times erroneous, has led to confusion among taxpayers. Addressing and rectifying these discrepancies remains an essential aspect of enhancing the overall efficiency of the tax compliance process.
Dispute Resolution Woes:
As technology takes centre stage, there’s a pressing need to enhance dispute resolution mechanisms. The increased efficiency in data collection should be paralleled with an equally robust system for addressing disputes promptly. This is crucial to provide taxpayers with the confidence that their concerns are heard and resolved in a timely manner.
Transition to the New Regime:
The introduction of the new income-tax regime, marked by lower rates and fewer exemptions, has undoubtedly been a significant shift. However, its seamless integration into the broader tax ecosystem requires careful monitoring. The adaptation of businesses and individuals to these changes demands continuous evaluation and refinement.
A Digital Drive’s Impact:
Undoubtedly, the Income Tax Department’s digital initiatives have yielded substantial results. The procurement of data from diverse sources, ranging from educational institutions to utilities and vendors, has significantly widened the tax base. The remarkable increase in the number of returns filed, from 3.36 crore a decade ago to 7.85 crore today, stands as a testament to the success of these efforts.
Financial Landscape Transformation:
The imposition of tax deduction at source (TDS) on various payments, coupled with the introduction of tax collection at source (TCS) on multiple transactions, has left little room for tax evaders. The simplicity introduced through AIS (Annual Information Statement) has consolidated crucial financial information, reducing the likelihood of income escaping the tax net.
Celebrating our achievements is essential, yet it is equally necessary to acknowledge and address the existing challenges within India’s tax compliance framework. The trajectory towards a more efficient and technology-driven tax system is ongoing, emphasising the significance of a continuous cycle of innovation, adaptation, and improvement for the future of tax compliance in India.
- Vodafone Idea’s Upcoming Fundraising: Aiming to Collect ₹18,000-20,000 Crore - April 11, 2024
- Is the Indian Stock Market Open Today? - April 11, 2024
- Emerging Regional Carriers Aim to Capture Growing Short-Haul Flight Market in India - March 25, 2024
