The Tax Tangle

The government asking corporates and professionals to report estimates of income and tax liability will add to the compliance burden.

- Dipak Mondal

At a time when compliance issues under the Goods and Services Tax (GST) are proving to be a nightmare, the government has dropped another bomb by asking corporate and professional taxpayers to voluntarily report estimates of current year’s income, tax payment and advance tax liability.

The move, which is likely to increase the compliance burden of taxpayers yet again, shows the government’s aggressive stance towards any tax evasion or deferment of tax payment. However, it could prove to be another blow to businesses, already hit by the government’s over-the-top quest for the eradication of black money and tax evasion.

In a draft notification, the Central Board of Direct Taxes has “proposed to create a mechanism for self-reporting of estimates of current income, tax payment and advance tax liability by companies and persons eligible for tax audit on a voluntary basis”.