Facing criticism, govt puts new I-T return form on hold

Apr 19 2015 : The Times of India (Ahmedabad)

Facing criticism, govt puts new I-T return form on hold

New Delhi: TIMES NEWS NETWORK





FM Calls Up From US, Asks For Review

Facing a furious backlash against the proposal to seek details of foreign travel and bank accounts of taxpayers in the 14-page new income-tax return forms, the government on Saturday moved swiftly to contain the damage and decided to put the new form on hold.

"The finance minister spoke to me from Washington and discussed the matter. It was decided that the whole matter will be reviewed. The effort will be to simplify the forms," revenue secretary Shaktikanta Das told TOI. Arun Jaitley is in Washington to attend the IMFWorld Bank meetings.

Tax authorities had made several additions to the income-tax return form for the assessment year 2015-16 seeking details about foreign travel, foreign assets and income from any source outside the country , and details of all bank ac counts held in India at any time during the previous year. A taxpayer had to submit details of any foreign trip undertaken including the expenses borne.

The new form also sought details of any bank account opened or closed during the previous year, including those where a taxpayer has a signing authority . The form ­ which goes against the efforts to make I-T returns "saral" ­ also sought information related to immovable property , financial interest in companies and details of trusts created outside the country . In case of domestic bank accounts, taxpayers were required to provide the name of the bank, IFSC code of the branch and also mention whether it is a joint account.

The news of the new additions to the IT return form met with an avalanche of criticism with ordinary taxpayers and experts questioning the move.

Taxpayers were worried about the extra effort needed to fill in the details and experts said it would have added to more paperwork and harassment. The effort over the years has been to simplify the tax return forms to make life easier for ordinary taxpayers but the latest additions to the IT return forms would have diluted those efforts.

"The government has been proactive and quick in deciding to review the forms," Das said.

Tax experts said it would have been a nightmare for tax payers who make frequent foreign trips to provide details of expenses and slammed the move to introduce this provision in the form. Sources said the move to include the new information was part of the of the recommendations of the special investigation team probing the black money issue and authorities had decided to modify the I-T return forms as a fight against the black money menace.

The move faced severe criticism from tax consultants, tax payers who said the government is asking for too much data. The government has taken several steps to usher in a "non-adversarial tax regime" and has laid down several guidelines for the tax department on how to deal with taxpayers. The NDA government has been battling with the legacy issue of retrospective taxation and trying to put a lid on "tax terrorism" which it has said was unleashed by the UPA government.