On 5 July, Nirmala Sitharaman, the Finance Minister announced the Union Budget 2019. FM proposed to implement “faceless assessment” in a phased manner later this year. The Modi government has delegated the task of designing a framework concerning faceless tax assessments to a high-level committee.
FM stated during her Budget 2019 speech that the current tax filing system comprises a significant level of personal interaction between the income tax department and a taxpayer. With this interaction, there is more scope for taxpayers to evade taxes.
With the implementation of the “faceless assessment” system via the electric mode, the need for a human interface between the taxpayer and the department will be cut down. Also, the government plans to make pre-filled tax returns available to taxpayers wherein information related to bank interest, salaries, dividend income, and capital gain will be pre-populated.
FM mentioned that initially, the new process of examination would be limited to inspection of specific discrepancies and transactions. The Central Cell will be the single point of contact for both the taxpayer as well as the income tax department under the new mode of income tax assessment.
The tax filing cases which are shortlisted for research and careful examination will be aligned to random assessment units, and a Central Cell will issue notices electronically. The Assessing officer’s name/designation/location will not be disclosed.
The Modi government aims to curb tax evasion by introducing faceless IT assessment and making pre-populated ITR available for taxpayers. Financial experts are of the opinion that the new assessment system has the potential to curb tax evasion, however, problems are likely to occur at the time of implementation.
Bhavana is a Senior Content Writer handling the GST vertical. She is committed, professional, and has a flair for writing. When away from work, she enjoys watching movies and playing with her son. One thing she can’t resist is SHOPPING! Her favourite quote is: “Luck is what happens when preparation meets opportunity”.