The FM was speaking on the occasion of the 165th year of Income Tax, where congratulated Indian taxpayers for their contribution in helping the economy.
Sitharaman took this opportunity to emphasise on the need for the language of income tax notices and letters issued to the public to be simplified.
“Tax notices need to be simplified so that people understand them better. Can we explore issuing simple, easy-to-understand notices?”FM Sitharaman asked.
Moreover, the FM asked income tax department to refrain from using “threatening language” in tax notices.
“Let the experience of filing tax return on the first day be as good as filing it on the last day. We have to ensure that threatening language in tax notices and messages is avoided,” said the FM. Further, FM Sitharaman mentioned Prime Minister Narendra Modi’s vision of a “simple system”. She called on the tax department to approach the tax paying public with more transparency and less intimidation. “Prime Minister Narendra Modi had been very clear from the beginning that we need to provide a simple system,” the FM noted.
Furthermore, FM Sitharaman announced that India recorded a net addition of 58.57 lakh first-time tax filers this year.
She hailed the feat achieved by tax officers with this collection and revealed that they had to face challenges in the last ten years to reach this target.
“The last ten years were full of challenges for India and tax officers. The collective effort of the tax-payers and income tax officials have led to the highest ever income tax collection,” Sitharaman exclaimed.
She also revealed that at least some part of the Tax Code will be simplified within six months.
Sitharaman said that 72 per cent of all tax payers have moved to the new tax systems. She called the new tax regime simple and listed its advantages.
“Second tax regime is simple, no exemptions and headaches. 72 per cent of all tax payers have moved to new tax systems,” she said.
Sitharaman further stated that India’s direct taxation is helping tax-payers transition towards an easier tax system.
“India’s direct taxation is understanding requirement of people and allowing them to transition towards easier tax syatem. The approach is of nudge and not of forcing regimes,” the FM stated.
The FM noted that this approach of tax collection increases compliance and widens the tax base.