Syllabus: GS-III
Subject: Economy
Topic: Taxation
Context: In the budget speech, the finance minister proposed to withdraw a range of small tax demands under dispute dating back to 1962.
Synopsis:
Taxes outstanding increased by 35% in 2022-23.
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- This increase was primarily due to a sharp rise in undisputed demands.
(Tax demand outstanding is categorized by the duration of the demand and The duration categories include 10+ years, 5-10 years, 2-5 years, 1-2 years, and less than 1 year.)
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- Direct taxes are primarily driving recent undisputed demands.
- Taxpayers can dispute the amount demanded by the income tax department through an appeal process.
- Appeals can be raised before the Commissioner of Income Tax (Appeals), the Income Tax Appellate Tribunal (ITAT), and higher courts.
- Corporate and income tax contributes to over 90% of raised but not realized taxes.
