Work In Progress To Simplify Tax, Cut Litigation: Sitharaman

There is a lot of work happening on simplifying tax, improving taxpayers' services, providing tax certainty and reducing litigation, Finance Minister Nirmala Sitharaman said on Wednesday.

"This Budget 2024–25 has made very clear statements that there shall be four major objectives that we would like to achieve: simplifying tax, improving taxpayers' services, providing tax certainty and reducing litigation," she said at the celebration of the 165th year of the Income Tax Department in New Delhi. "On all these four grounds, I can see a lot of work happening."

Within all these announcements, the Union government will have the tax code of the Tax Act, or at least some parts of it, written in simple and easy-to-understand language. There is a committee within the Central Board of Direct Taxes that is working on it, according to Sitharaman.

She underscored that tax officers must pay attention to improving the taxpayers' experience by writing tax notices or letters in easy and simple language.

On the adoption of the new tax regime, Sitharaman said the number of new net additions of taxpayers had gone up this year and approximately 58.6 lakh income tax returns were received from first-time tax filers. With this, she expects tax net widening going forward.

The minister also urged the CBDT to see best global practices, the emerging areas where India needs to learn and international taxation assessment as the country needs to get a grip on how this is being handled the world over.

Sitharaman said more officers should be deployed to dispose of the backlog of first appeals and asked officers to move fast on these matters. She pointed out that there is room for further improvement in making tax refunds faster.

The finance minister appealed to the tax officers to collect taxes with all fairness, transparency and in a friendly manner.