Cloud over tax amnesty plan deadline in wake of coronavirus
Vivad Se Vishwas — the Narendra Modi-government’s ambitious tax amnesty scheme — may be laid low by the coronavirus, with tax practitioners saying the initial deadline of March 31 is a non-starter, given the restrictions imposed on government offices because of the virus.
With less than a fortnight way, the amnesty forms are yet to be uploaded on the internet. The scheme aims to swoop up a whopping Rs 9.32 lakh crore struck in tax litigation.
The Vivad Se Vishwas Act has been published in gazette on Tuesday after presidential assent.
Even though Union finance minister Nirmala Sitharaman appealed to the chartered accountant community at an event in New Delhi on Monday to make the scheme a success, tax officials and practitioners were concerned over the practical implementation of the scheme amid restrictive workplace instructions and the tight deadline of the scheme.
The union ministry of personnel in an office memorandum issued on Tuesday, as part of steps to contain the spread of coronavirus, has asked central government offices and departments to undertake essential correspondence on office mail, avoid physical transfer of files, cut down on non-essential travel, discourage the entry of visitors to the extent possible and conduct meetings through video conference as much as possible.
“Most of the correspondence in such a situation is expected to be digital. But there could be situations where physical documents are needed. So there could be some practical problems. But we have to try and adapt as much as possible,” said an income tax department official.
The All India Federation of Tax practitioners (AITFP) will write to the finance minister in the light of coronavirus to extend the deadline of the scheme by one month to April 30, 2020.
“We will be sending a representation to extend the March 31, deadline. Instead of March 31, the deadline should be April 30. Again the last date of the scheme (to be notified) should also be extended by 1 month,” said Narendra Goyal, president, the AIFTP.
According to Goyal, the reason for the extension is two fold: a delay in the notification of rules and the issue of forms along with the practical restrictions on account of coronavirus.
“Today is already March 17. Suppose even if the forms are hosted today and the commissioner issues the certificate tomorrow or day after, then also 15 days time will cross March 31, 2020,” he said.
“Various restrictions on account of coronavirus are likely to continue till April 15 minimum. If we seriously want the scheme to succeed the deadline should be more practical,” tax advocate Narayan Jain said.
As per the scheme, that aims to settle 4.83 lakh direct tax cases, a taxpayer whose appeal is pending as on January 31, 2020 at various courts will have the opportunity to settle the dispute by making an application on a prescribed form.
Once the application is accepted, and the taxpayer pays 100 per cent of the disputed amount, before March 31, 2020, there would be immunity from interest and penalty levy, as well as prosecution.
In case the disputed amount is paid after March 31, 2020, there will be a 10 per cent increase in the amount payable.