The global nature of the coronavirus has compelled life as we know it to come to a halt. In the wake of this pandemic, India is no exception. With a majority of commercial and non-commercial activities being put on hold for the last 2 months due to the ongoing national lockdown, almost all aspects of the country have suffered tremendously – socially, economically, and more.
The government, however, is making several provisions for the general public to get their lives back on track, especially as the lockdown is being relaxed in several parts of the country in a phased manner. One of the most required revival plans is that of the economic activities, especially tax payment aspects.
In light of the Coronavirus outbreak, with almost all professions and occupations on a standstill and incomes at an all-time low, it becomes pertinent to adjust the timeline of tax payments. As a norm, the tax compliance cycle begins from January and goes on up till July. However, in light of the recent developments, the timelines had to be extended for this financial year.
Extension of Tax Dates for Financial Year 19-20
Due to the above-mentioned reasons, the Indian government offered a few relaxations under the Income Tax Act and other direct assessment laws. The administration stretched out cutoff tax dates and deadlines to document personal assessment forms under a few direct duty rules, and also relaxed the penalties under different laws.
One of the major impacts of this step would be that it would directly affect the financial liquidity of individuals in these troublesome times. This money can be rerouted for medical expenses or for sustaining essentials for the time being. In addition to this, the government offered a 25 percent decrease in TDS (Tax Deduction at Source) for non-salaried determined installments and TCS (Tax Collection at Source) for indicated receipts. It also decreased the Employee Provident fund for 3 months in the case of private firms.
In addition, the government also lowered the interest rate on delayed payment of advance taxes, tax deducted at source, tax collected at source and equalization levy, etc. from 12 or 18 percent to 9 percent, on the condition that the payment is made up till June 30.
Some of the noteworthy steps taken by the government in regards to the dates of the tax regime are:
The primary purpose of all of these steps taken by the government is not only to ensure that the economic interests of the individuals are protected but also to protect the law and order situation of the country which may have been disturbed in case adequate relief would not have been provided. Further, it would lead to a plethora of litigation being filed in various courts, causing further depletion of the State’s revenue.
Having said that, due credit and sincere appreciation should be given to the government for making progressive policies as well as adjusting them according to the rapidly evolving contemporary situations that prevail in the country. This is a challenging and tough time, and we, along with the Government, should make constant strides to overcome the problems presented to us because of the coronavirus. For advice on best practices during tax filing, refer to our post here.
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