India’s move to simplify its income tax law promises us relief from something even experts found hard to comprehend. And it’s unjust for anybody to be hauled up for breaking rules they can’t understand.
Summary
- India's move to simplify its income tax law promises us relief from something even experts found hard to comprehend. And it's unjust for anybody to be hauled up for breaking rules they can't understand.
A new income tax bill was finally placed before Indian lawmakers in Parliament on Thursday. This proposed law significantly cuts down the current legislation's text, reduces its number of sections and tries to simplify its language.
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Terms like "assessment year" and "previous year" have been replaced with "tax year" and "financial year", respectively, for example. This has been done to make these terms easier to understand. Similarly, its content has been re-ordered to improve the law's coherence and thereby ease its comprehensibility, something which numerous tweaks over the decades had turned into a challenge even for experts.
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This was a state of affairs crying out for attention. As a matter of natural justice, any law that carries penalties for its violation should be easy to grasp. People being hauled up for breaking rules they cannot comprehend is unfair.
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Indeed, among the chief aims of liberalization has been to reduce India's thicket of rules so that economic agents do not end up in trouble unwittingly. This simplification is consistent with that ideal. India has only a small fraction of its population paying income tax right now. For the net to widen, taxation needs to be taxpayer-friendly.