Drama of Extension

It's observed last few years that there is an unanimous demand for extension of due dates by Chartered Accountants and Tax Professionals. It's a common phenomenon in tax field. And it is also habitual that demand for extension is accepted by the government very late and close to the actual due date.

Today we will review this whole matter of extension of due dates in this article. First of all we need to study why there is a constant need for extensions.

1. Poor Quality of Government Websites and Softwares:

First reason that comes to mind is the complex nature of laws and constant changes in it. There are changes in the software schema till very late by the government department. It takes time to understand these changes and then work on it for the Chartered Accountants and Tax Professionals. In this case to ask for extension is fair on the part of them. It is the repeated experience that tax compliance softwares issued by government are not well thought of, considering all the permutations and combinations of different tax situations. Due to this, government has to make constant changes to the softwares till very last moment.

2. Multiple clashing due dates:

Second reason that comes to mind is clashing of due dates of two different acts and regulations. Here it is felt that two different government departments can work together to confirm that their respective due dates not clash with other due dates. Demand for extension in such cases is also fair and should be allowed by the government. Here government may also think of staggered manner of compliance for different sections and type of taxes. Government should consider lowering the overall compliances requirements in India. India ranks poorly in the world on count of tax compliance burden.

3. Natural Calamities:

There are some natural calamities like in this year public is struggling with COVID-19. Public transportation is affected, there is a need for social distancing and there is constant risk of catching COVID-19. It is not allowing public to function in normal way. In such cases it is fair on their part to ask for extension. It is very hard to imagine that when government is aware of all these things, why it fails to accept the requests for extension. Also when in the past government has given extension, it has come very late. Giving extensions in the last 2-3 days is of no use as damage is already done. It is already taken toll on professionals health, it has already affected the quality of audit reports and returns that have been uploaded. It has already affected the confidence of the people in the government.

4. Festivals:

It is also seen that on lot of occasions government compliance due dates are clashing with Indian festivals. In Indian culture, festivals hold an important part in lives of people. Not planning due dates according to festivals also affects the moral and well being of the people. Government can plan for festivals if they value the nation building Taxpayers and Tax Professionals.

There are also people who are of the opinion that extension of demand is not fair as it happens because of lack of planning and taking excess work beyond the capacity of the firm. Such work should be delegated. But we feel this may be true in few cases but most of ther cases are genuine and not because of lack of planning but because of reasons mentioned above.

Government should acknowledge the fact that in spite of all the hardship, Tax Professionals have never taken any drastic step like Pen Down Movement and they have always tried their best to comply with all the government requirements. Tax professionals should be respected for this gesture. They always put forth their request in a polite manner and government should appreciate that and should take care of tax professionals. Kindly comment on this article and let us know your views on this.