The Parliament has adopted Vivad Se Vishwas Bill, 2020 today
The bill provides for an exemption of interest, penalty, and prosecution for the settlement of direct tax disputes. It grants a complete waiver of interest and penalty if the amount at issue is paid before the 31st of this month, and provides for an additional 10% of the amount at issue in cases where the settlement is made before 30 June of this year.
Rajya Sabha approved a motion to bring the bill back to the Lok Sabha. The lower house had passed the bill earlier.
The government will take all the steps to reduce tax litigation on a priority basis. Government assured that the discretion of the tax authorities would be reduced by a technology-driven, faceless assessment. Tax-related disputes in a country of more than 9 lakh crore rupees are pending against more than 4 lakh disputes in various appellate forums.
The Government assured that the provisions of this bill would provide absolute immunity from prosecution under the Income Tax Act once the dispute had been resolved. It has, however, clarified that it governs only disputes relating to Direct Taxation and not disputes relating to wealth tax. Addressing a request from a Member of Parliament, cases above five Crore Rupees are excluded under the scope of this bill in order to prevent the alleged tax elders from taking undue advantage of these provisions.
The bill has been drafted with the aim of resolving the tax dispute in an efficient manner.
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