Budget proposals aim at tax certainty: PC Mody

Mody said that by not changing tax rates and slabs or making any other tweaks, the budget sought to ensure tax certainty and even where tax law provisions were changed, the idea was to provide clarity and to minimise litigation. Mody was speaking at a post-budget industry interaction organised by the Confederation of Indian Industry (CII).

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“Earlier we raised monetary limits for filing appeals by the department at a higher forum. That went some distance in trying to reduce litigation….We carried the journey further by bringing the Vivad se Vishwas (direct tax dispute resolution) scheme, which I must say, has been a great success,” Mody said.

The new proposals for setting up a panel to resolve small tax disputes and making the Income Tax Appellate Tribunal’s working faceless were also aimed at making tax administration more transparent and efficient, he said. Widening and deepening the tax base is also of equal importance, Mody said.

The proposal for denying employers the benefit of deduction in the case of delayed deposit of employees’ contribution to the provident fund account is also a clarificatory amendment, explained Kamlesh Varshney, joint secretary in the CBDT.

“It is absolutely necessary that whatever money is collected by the employer from the salary of the employee, it must be deposited within the due date of the law under which this amount is to be deposited. Any delay means it is the employer who is using the money which doesn’t belong to the employer and that is probably not fair to the employee,” explained Varshney.