Letters: Taxing delays

Finance Minister P Chidambaram has started well in his assignment and indicated priorities that are right. He should add “timely refunds to tax payers” to his list. It is unjustifiable for the government to defer refunds to the next financial year for the sake of showing a lower fiscal deficit in the current period. It can do so now because the accounting is on a cash basis. Once the system shifts to an accrual basis, it will not be possible. But it may take years. In the meantime, the FM should lay strict guidelines for timely assessment and refunds so that the tax payer does not have to wait for more than a year or so. In the past, refund cheques were delayed in despatch. In one instance, I found the cheque had to be revalidated by the officer because its validity had expired. It had been lying in the office for several months. Now with the procedure followed to credit the refund to the assessee’s bank account, there is no scope for corruption at the level of the despatch clerk. But it still exists at higher levels through delays in assessments and refunds. One disincentive for delaying refunds beyond a specified period is to make the official responsible to reimburse the government for the interest paid to the assessee.

A Seshan, Mumbai

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