Jul 30, 2010

Got my Income Tax refund

One of my problems is that I spend lots of time in Singapore as well as in India. Unlike people that live mostly in one country, I have to adapt constantly. Returning NRI's after a long stint abroad eventually get 'immunised' to the Indian way of doing things fairly quickly. They 'system' 'normalises' them, even if they have to be dragged in kicking and screaming. And Indian executives and businessmen that travel abroad often get back to 'local' settings practically as soon as they land in India (with new airports they have to wait until they are out of the airport into the streets).  But my case is different, I have to constantly switch modes.

Which means when I am in India I have to learn to live with all its well known problems. The sound of vehicle horns, which signals an emergency or life threatening situation in Singapore is practically a always-on device used to 'clear' traffic ahead of you when back in India, for instance. I never can get used to that...

But I am going to talk about a good thing here - Income Tax (IT) return filing, assessment and refunds.

I got the refund for AY 2009-10 which for the fiscal year ending March 2009, already!!!

The amount is fairly small (less than Rs.5,000) but tells us a lot about how India is moving ahead in its own pace but in the right direction...

  • Firstly the return was filed hardly a year ago, back in July 2009.
  • Secondly it was filed electronically without any need to mail in anything.
  • Thirdly I did absolutely no chasing, follow-up, certainly no bribing or 'baksheesh' to get it done!

I remember the days when Chartered Accountants used to spend practically their entire working day in IT offices, greasing palms, begging, pleading and cajoling IT staff into processing returns, and getting the 'assessment order' done. They used to know if the officer likes Scotch whisky or is the one that goes to Tirupati temple for prayers every other week and modify their behaviour accordingly. It is the kind of knowledge that can save your career or make it. I also remember IT staff went on protest when the system of  random checking was introduced - for obvious reasons.

But now technology and reforms are making all that redundant. You don't need to know who your ITO is (unless you get raided for tax fraud) or even where the returns are processed. I heard they are done centrally and is also partly outsourced....the dirty word outsourcing is not a one way street. And tax rates are more reasonable now.

All this is fairly commonplace in Singapore and has been that way for at least 20 years to my knowledge. Around April each year you file a return that barely takes 5 minutes to fill in, (for 99% of folks), mail it (now electronic) and get your assessment order three or four months later, with 30 days to pay your tax. No TDS, No Advance tax, no nonsense. That simple.

Give them a few more years and India's IT process may get there...I am optimistic.

Time to celebrate that little cheque for many reasons!

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