Prime Minister Narendra Modi on Thursday announced a number of Income Tax reforms to further digitise the tax-paying system and add more transparency. The Prime Minister launched the 'transparent taxation' platform having components — faceless appeals by taxpayers, faceless assessment of taxpayers and the Rights' Charter for the taxpayers. An in-depth look into what these tax reforms mean.
What are Faceless Appeals in transparent taxation reforms?
- As per the new reforms, Faceless Appeals aims to add more trust, transparency in the system. Under this, appeals made by a taxpayer will be randomly allotted to any Income Tax officer in the country.
- The identity of officers deciding appeal will remain unknown.
- A taxpayer won't need to visit the officer or the office.
- The appellate decision will be team-based and reviewed.
Exceptions will be made only in cases relating to:
- Serious frauds, major tax evasion, sensitive and search matters.
- International tax
- Black Money Act and Benami Property.
What is faceless assessment of taxpayers?
- Under the Faceless Assessment system, the selection of any appeal by a taxpayer will be selected only through the system using data analytics and AI.
- Abolition of territorial jurisdiction.
- Automated random allocation of cases.
- Central issuance of notices with document identification No. (DIN)
- No physical interface, no need to visit the income tax office.
- Team-based assessments and Team-based review
- Draft assessment order in one city, review in another city and finalisation in the third city
Exceptions as same as faceless appeals system
What is taxpayers' charter?
With the 'Transparent Taxation Honouring the Honest' that is aimed at carrying forward the journey of direct tax reforms, the taxpayers would not be harassed or treated with suspicion here on. Speaking at the launch, the Prime Minister said that India is among a few countries giving such rights and dignity to the taxpayers.
He said that the charter has been introduced with defined rights and responsibilities. From here on the Income Tax Department cannot doubt anyone without a basis, he said.
- Any assessment, other than the exception, outside the faceless scheme, will be invalid.
- No intrusive and survey actions by field officers. Only investigation wing and TDS wing can after approval by an officer of the level of a chief commissioner or above.
PM Modi is of the view that the structural reforms will add a new dimension along with the transparent taxation platform. He also noted that reforms should be policy-driven and holistic.
Speaking of the recent measures, he said that nearly 3 lakh cases were resolved under the 'Vivaad Se Vishwas' scheme.
He also appealed to the citizens and said that those who are capable of paying taxes but not in the tax net should also voluntarily pay taxes.