In an attempt to bring relief to about 10 million taxpayers, outstanding direct tax demands up to Rs 25,000 for the period till FY10 and up to Rs 10,000 for the period between FY11 and FY15 have been withdrawn. This may provide a relief of around Rs 3,400 crore to the taxpayers, as per estimates.
“There are a large number of petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing anxiety to honest taxpayers and hindering refunds of subsequent years,” finance minister Nirmala Sitharaman said.
Experts say the move is expected to provide relief to a large section of small- and mid-level taxpayers.Sitharaman said the introduction of faceless assessment and appeal has imparted greater efficiency, transparency and accountability; and new form 26AS and prefilling of returns have made filing simpler and easier.
Due to these steps, the average processing time of returns has been reduced from 93 days in FY14 to just ten days in FY24, thereby making refunds faster, the FM said.
On GST, the FM said the regime, introduced in July FY17, has reduced the compliance burden on trade and industry, widened tax base, and increased revenues for the Centre and states. “States’ SGST revenue, including compensation released to states, in the post-GST period of 2017-18 to 2022-23, has achieved a buoyancy of 1.22.
In contrast, the tax buoyancy of state revenues from subsumed taxes in the pre-GST period of 2012-13 to 2015-16 was a mere 0.72,” she said. Manish Mishra, partner, JSA Advocates and Solicitors, said, “We expect that the government will continue to usher in the reforms and facilitation measures on the indirect tax front, and look forward to the next Budget in July.”