The era of harassment of taxpayers is over: Prime Minister

“Today as the tax system is becoming faceless, it is giving confidence to the taxpayer of fairness and fearlessness,” said the Prime Minister while reassuring the honest taxpayers that there will be no harassment under the new system.

New Delhi: Harassment of taxpayers will be a thing of past with the launch of a faceless, seamless system for tax assessment and appeals where officers located in different parts of the country will be randomly selected by a computer programme, said Prime Minister Narendra Modi while launching a Taxpayers’ Charter on the lines of some advanced economies.

The taxpayer’s charter launched by Prime Minister Narendra Modi in New Delhi today has 14 obligations for income tax authorities while also casting six obligations on taxpayers.

“This Transparent Taxation - Honoring the Honest system has three pillars of faceless assessment, faceless appeal and a Taxpayers' Charter,” said Prime Minister Modi.

He said the faceless assessment and taxpayer’s charter has come into force from today and the faceless appeal will be implemented from September 25, on the occasion of the birth anniversary of Pt Deen Dayal Upadhyay.

“Today as the tax system is becoming faceless, it is giving confidence to the taxpayer of fairness and fearlessness,” said the Prime Minister while reassuring the honest taxpayers that there will be no harassment under the new system.

The Prime Minister said the new tax administration system is an outcome of his government’s approach, which is people centric and people friendly rather than power or process centric.

He said the country is reaping the benefits of a new governance model in a New India, which does not believe in short cuts.

Prime Minister said new governance model is based on the four pillars, (a) policy driven governance which has crystal clear policies (b) confidence in the honesty of taxpayers, (c) by minimizing the human interface in the functioning of government by using technology at a large scale, and by inculcating the values of efficiency, integrity and sensitivity in the bureaucracy.

Faceless Assessment, Faceless Appeal

Prime Minister Modi said Indian tax system needed a structural reform as it was conceived during the colonial period and despite some changes since independence, it remained colonial in nature where income tax notice was like a diktat.

He said the new tax system will be painless, seamless and faceless where a taxpayer and an assessing officer will not be based in the same city.

Similarly, under the new system, the appellate officers will also be based in different cities which will be assigned randomly through a computer programme to minimize the scope of corruption and harassment.

While lauding the income tax officers for curtailing their own powers, Prime Minister Modi said it will end the lobbying in the income tax department for transfer and posting.

Tax scrutiny cases register a steep decline

Prime Minister Modi said the new system is based on confidence in taxpayer’s honesty, which also reflects in the sharp decline in the number of scrutiny cases in the last six years.

“In 2012-13, scrutiny was done in 0.94 of all the income tax return filed which has declined to just 0.26% in 2018-19, it means it declined to just one fourth,” said Prime Minister Narendra Modi.

Small size of taxpayer base is a cause of concern

Prime Minister Narendra Modi appealed to the people to voluntarily come forward to pay taxes as they will be used in nation building.

He said though the number of income tax return filers has gone up significantly as 2.5 crore new income tax return filers have joined the system in the last six-seven years.

He, however, expressed concerns over minuscule number of income taxpayers in the country as just 1.5 crore people pay income tax in a population of over 1.3 billion people.

(Article by Krishnanand Tripathi)