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Budget 2020 proposes to introduce a taxpayer’s charter to spell out what your rights are

In a recent report, the International Bureau of Fiscal Documentation had stated that the enactment of such a taxpayer charter was necessary to ensure that the rights of taxpayers were protected in the real sense.

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Last Updated: Feb 02, 2020, 11.16 AM IST
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Tax charter will spell out what your rights are
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(This story originally appeared in on Feb 02, 2020)
The decision to introduce a taxpayer’s charter as a part of the statute is being viewed as a positive step. A charter defines the rights of a taxpayer and the obligations of the tax department.

Hitesh Gajaria, co-head of tax at KPMG India, said, “While the contours of the charter have not yet been defined, it will lead to greater accountability and send a strong signal that the government intends to be taxpayer-friendly.”

“We wish to enshrine in the statute a taxpayer charter through this Budget. Our government remains committed to taking measures to ensure our taxpayers are free from tax harassment of any kind,” FM Sitharaman said in her speech.

In a recent report, the International Bureau of Fiscal Documentation had stated that the enactment of such a charter was necessary to ensure that rights of taxpayers were protected in the real sense. As many as 40 countries (of the 42 surveyed) had such a charter in place, but only in 33% of these was it legally effective.

Countries like Belgium, Brazil, Chile, Italy, Kenya and Mexico have the charter as a part of their statute, akin to the proposal made by the FM.

While Australia and Canada do have a charter in place, it doesn’t have the protection of an Act. The Netherlands, on the other hand, has avoided a charter altogether, claiming that taxpayers’ rights are sufficiently recorded under various tax laws.

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