Income tax filing to take just one day; Infosys to develop new system

The Union Cabinet yesterday sanctioned close to Rs 4,242 crore for the next-generation income tax filing system, which will cut down the processing time for returns to just one day from 63 days currently while expediting refunds.

According to Union Minister Piyush Goyal, India’s second largest IT services firm Infosys has been selected to implement the Integrated e-filing and Centralized Processing Center 2.0 Project of the Income Tax Department after a bidding process. The project is expected to be completed in 18 months and will be launched after three months of testing. However, sources told The Times of India that the idea is to implement it within 15 months, in time for tax filing season 2020.

In an official statement, the government pointed out that the new project has several benefits for the Department and taxpayers beyond expedited processing time. Think pre-filled ITRs as a means to improve accuracy, a system for quicker rectification of mistakes, integrated contact centres for taxpayer assistance, an employer/partner accreditation program to bring significant enhancement in services to taxpayers, and more.

“The decision will ensure horizontal equity by processing returns filed by all categories of taxpayers across the country in a consistent, uniform, rule driven, identity blind manner. This will assure fairness in tax treatment to every taxpayer irrespective of their status,” read the statement, adding that the e-filing and CPC projects have enabled end-to-end automation of all processes within the Department to promote voluntary compliance.

A tax officer told the daily that once the new mechanism is in place, taxpayers will get a pre-filled form in their income tax account which will have their name, Permanent Account Number (PAN) as well as all the details related to salary, interest income and tax deducted at source captured in the 26AS forms. If any income is yet to be declared, taxpayers can simply add it to the form directly.

The government believes that the new system will also ensure transparency and accountability since refunds will be issued to the taxpayer’s bank account directly without any interface with the Department, while taxpayers will be provided processing status updates through email, SMS and mobile app.

Hence, if things go to plan, new project will not only be more tax and user friendly but will also help improve tax compliance and manage outstanding demand.

[“source=businesstoday”]