Government to Issue Quick Tax Refunds To Help Tide Over Coronavirus Crisis
All pending income tax refunds of up to Rs 5 lakh to businesses and individuals will be released immediately.
The government will fast-track all pending income tax, GST and customs refunds worth about Rs 18,000 crore to provide relief during the coronavirus outbreak.
All pending income tax refunds of up to Rs 5 lakh to businesses and individuals will be released immediately, said a statement by Ministry of Finance. This is estimated to benefit 14 lakh taxpayers, it said.
This would include all pending refunds of assessment year 2019-20 (financial year ended March 31) or any previous year, said a government official. These refunds should have ideally been issued within 60 days of the returns of being filed by a taxpayer, he said.
According to Sandeep Bhalla, partner at Dhruva Advisors, this is not a benefit as it’s taxpayers’ own money. Most of the pending refunds up to Rs 5 lakh, were anyways issued as payouts under this threshold of Rs 5 lakh, are processed expeditiously, Bhalla told BloombergQuint. Refunds pending over Rs 5 lakh that were held back due to year ending should also be released, he said.
GST and custom refunds will also be immediately released to provide benefit to about 1 lakh business entities, including micro, small and medium scale enterprises, the statement said.
Clearing of GST refunds will help businesses facing cash crunch due to the 21-day lockdown in resuming their operations, said MS Mani, a partner at Deloitte India.
Industry body Ficci in its ‘Business Continuity Plan’ submitted to the government had suggested that all duty drawbacks and refunds, including that for GST, should be cleared at the earliest