Tax Bill to expand faceless assessment scheme, provide relief to taxpayers

Tax Bill to expand faceless assessment scheme, provide relief to taxpayers

The Lok Sabha has passed a taxation Bill aimed at expanding the faceless assessment scheme and to provide compliance-related relief to taxpayers. The legislation includes extension of deadlines for return filing and linking of PAN and Aadhaar. The Bill was passed by a voice vote after stiff opposition on issues pertaining to tax treatment and transparency of PM Cares Fund and the GST compensation issue.

The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Bill, 2020, will replace the Taxation and other Laws (Relaxation of Certain Provisions) Ordinance, 2020 promulgated in March under which time limits for statutory compliances under goods and services tax, and income tax act were extended in the wake of the Covid-19 pandemic.

The legislation provides tax exemption for contributions made to PM-CARES Fund, which was set up in March. Besides, it makes faceless assessment applicable to at least 8 processes under the IT Act, including assessment, collection and recovery of tax, appeals, revisions, gathering of information, etc. With the amendment, transfer pricing assessments and litigation, and dispute resolution panel have been brought under the faceless scheme.

Finance Minister Nirmala Sitharaman said that faceless assessments and appeals will bring in tax transparency and bring an end to tax terrorism using technology. “We’re bringing in tax transparency through law because it is extremely important for the country,” she said.

The sunset clause for claiming a tax holiday for already approved special economic zones units has been extended by another year to March 31, 2021.