Tax Administration Reform: End of Tax Disputes in India?

Abstract

A long-due Indian direct tax administrative reform for removing the taxpayers’ plight and widening the tax base gained momentum by introducing the faceless assessments and appeals scheme coupled with taxpayers’ tax charter. Following a descriptive approach, the study assesses whether the reform would end the tax disputes. Albeit, ideally, any tax system should be simple, efficient, transparent, and free from conflicts. The Indian taxation saga indicates an infamous tug-of-war between the taxpayers and the revenue-seeking tax officers. Serving strange tax demand notices and retrospective amendments of the tax laws created a phobia of ‘tax terrorism’ in honest taxpayers’ minds. Considering this, the government followed the digital route with no physical interaction between the taxpayers and tax officers for tax assessments and appeals. Moreover, fixing the responsibilities of the taxpayers and tax officers would minimize tax disputes substantially if addressing the apprehensions and teething problems appropriately, addressing the apprehensions and teething problems.