Enlargement of scope of Tax Return Preparer (TRP) Scheme

he Government has decided to enlarge the scope of the existing Tax Return Preparer (TRP) Scheme and authorize them to prepare and furnish returns of Tax Deducted at Source (TDS) and Service Tax, in addition to income-tax returns. To carry out the aforesaid decision, the Central Board of Direct Taxes (CBDT) has decided to retrain the TRPs. For this purpose, a retraining course consisting of 15-day self-study followed by classroom training will be organized for TRPs relating to Income Tax and for Service Tax

View the press release here.

View the details here.

Income Tax Employees charter of demand adopted at XXVII All India Delegates Conference of ITEF.

The XXVII All India Delegates Conference of the ITEF held at Mumbai from 10^th to 14^th February, 2009 after the deliberations on the report submitted by the Secretary General resolved unanimously;

 

That the ITEF should embark upon agitational programmes including strike action, if no settlement as assured by the CBDT earlier is not brought about on the charter of demands and especially on the following issues immediately.

 

(i)                            assigning grade pay of Rs. 4600 as per Government of India notification to Inspectors, Private Secretaries and Administrative officers and Rs. 1800 to all Group D employees;

(ii)                          all employees are provided with mobile phone facility out of the infrastructure fund;

(iii)                         no outsourcing of any departmental functions, especially the return processing, as per the recommendations of the BPR report;

(iv)                        the BPR should not be acted upon without reaching an agreement with the ITEF

(v)                          all Group C employees be provided with desktop computers to facilitate and speed up the functions entrusted to them immediately.

 

The Conference decided that the newly elected CHQ Secretariat should meet immediately to chalk out necessary campaign programme to popularize the demands and mobilize the members for the eventual action, to be organized;

 

The Conference regretfully noted that the DG (Systems) and the Directorate of System have totally failed in providing the software programme and hardware tools in time resulting in inordinate delay in processing returns.  The migration of data to the National Server and the delay in connectivity have compounded the problem.  The Conference decided to demand that no new system be introduced before the present scheme is stabilized and made effective.

 The Conference after considering the Accounts submitted by the CWC for the three years came to the conclusion that the financial health of the ITEF CHQ has to be improved and the renewal fees which are the only sustainable income should be significantly increased.  It was also considered by the house that in the event of the revision of wages on acceptance of the 6^th CPC recommendations, the income of members of the ITEF has also gone up and in the circumstances an increase in the rate of renewal fees would not be a financial strain for the members. Accordingly it was decided that the renewal fees would be raised from April, 2009 onwards as under:

 

            1. for those employees who are in PB 1.                       Rs. 20/=

            2. for those who are in PB 2                                         Rs. 30/=

 

            The Conference also took note of the fact that the dues on account of salary and allowance for the outgoing Secretary General are huge as is depicted in the Balance Sheet for the year 31.3.2008.  The Conference asked the CHQ Secretariat to immediately pay off the dues to Com. K.K.N. Kutty from out of the existing funds.

Pranab disappoints; no tax sops

External Affairs Minister Pranab Mukherjee, who is also managing the finance ministry, said in Parliament on Monday while presenting the Interim Budget for 2009-10 that tax rates must fall and our ability to pay taxes must rise.

However, he disappointed big time by not announcing any relief in taxes or change in the tax structure to bring relief to the common man.

So, in effect, the tax structure for the common man remains what it was the last year.

He did not announce any major sops and stuck to highlighting the achievements of the United Progressive Alliance government and just reading out a lackluster statement of accounts and achievements of the government over the last five years.

The stock markets sank as Mukherjee's speech continued, especially concerned over no fiscal measures or duty cuts or tax sops being announced.

Of particular concern to the industry and the markets is the rising fiscal deficit and the fact that the nation will have to wait for a full Budget to get any relief.

Source : Rediff.com.

Centralized Processing Centre for Income Tax Returns to be set up at Bangalore

The Union Cabinet has approved the proposal of the Income-tax Department to establish a Centralized Processing Centre (CPC) at Bangalore for processing of all electronically filed returns in the country and the paper returns filed in Karnataka. The CPC will enable the Department to process the returns and issue refunds expeditiously. It will encourage more tax payers to resort to electronic filing of returns. The creation of the new center entails an estimated expenditure of Rs. 255.46 crores over a period of five years. 

The workflow in the CPC will be managed by departmental officers and staff who would be assisted by vendor supplied manpower. The Departmental Officers and Staff will be responsible for logistics, coordination, supervising operations and sovereign responsibilities. They will also be responsible for resolution of mismatches in the information contained in the tax return and the Departmental data base and redressal of public grievances. The vendor would be responsible for developing software for processing of Income-tax returns and tax accounting. He will also be responsible for collection of returns from income-tax offices, scanning data-entry and storage of IT returns. 

The process of selection of the vendor is in its final stages and the Income-tax Department expects to operationalize the Centre within the next four months. 

The data relating to processing of returns would reside at the Primary Data-Centre of the Income-tax Department which has recently been commissioned at New Delhi. The Income-tax Department will continue to exercise full control over taxpayers’ data so as to maintain privacy and security of tax payers’ data. The establishment of the CPC will enable the department to release high-skilled resources, presently deployed for processing of returns, for redeployment to pursue large scale cross verification of actionable information. 

Backgrounder 

The processing of tax returns is a low skilled voluminous activity. Further, the processing output is extremely slow since the business process is cross functionally designed. As a result, the pace of issue of refunds and follow up action on recovery of underpayments is slow. This imposes an extremely high burden on the exchequer in terms of payment of interest on delayed refunds and also results in taxpayer dissatisfaction. This also encourages interface with the taxpayer. The delay in the recovery of the underpayments also entails a relatively higher interest cost for the Government in as much as it has to resort to borrowings to finance its expenditure. Therefore, the outcome of this processing exercise is not commensurate with the resources used. However, the importance of processing of returns lies in the fact that it signifies the ability of the tax administration to swiftly deal with non-compliance. 

Source : Govt. of India Press release.