Understand the recently introduced Direct Tax Vivad se Vishwas Bill
Direct Tax Vivad se Vishwas Bill is aimed at resolving direct tax related disputes
The government introduced The Direct Tax Vivad se Vishwas Bill, 2020, on Wednesday. It led to an uproar in Parliament. Congress leaders opposed the criticized the bill for two reasons – one for the Hindi name, arguing that government wants to impose Hindi on non-Hindi speakers. Second reason that Congress cited was, the bill treats honest and dishonest people equally.
Undestand what is the Direct Tax Vivad se Vishwas Bill
The Direct Tax Vivad se Vishwas Bill is aimed at resolving direct tax related disputes in a speedy manner. Finance Minister Nirmala Sitharaman unveiled the Bill which was to do what Sabka Vishwas Scheme do for indirect tax related disputes. FM while presenting the budget said that Sabka Vishwas Scheme resulted in settling over 1,89,000 cases of indirect taxes.
Finance Minister said that there are about 4,83,000 direct tax cases pending in various appellate forums, that is Commissioner (Appeals), Supreme Court, High Court and ITAT. The idea is to reduce litigation in the direct tax arena.
Under the proposed Vivad se Vishwas scheme, a taxpayer would be required to pay only the disputed taxes amount and will get complete waiver of interest and penalty provided he pays by 31st March, 2020. People availing this scheme after 31st March 2020, will have to pay some additional amount. However, the scheme will last till June 30th 2020 only.
How much money is at stake?
As per the reports, more than Rs 9 lakh crore worth of direct tax disputes are pending in the courts. The government hopes to recover a big chunk of this amount in a swift and simple way, while offering the taxpayers the relief of not having to flight the case endlessly. This move makes a lot of sense especially for a government that is staring at a big shortfall in revenues.
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The official name of the Bill is Direct Tax Vivad se Vishwas Bill. However, Nirmala Sitharaman while presenting the Budget on 1st February mentioned the English name of the scheme – No Dispute, But Only Trust. She commented that the name has nothing to do with imposing Hindi.
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