Justice Dalveer Bhandari, who has again been elected to the International Court of Justice, had once made some very practical suggestions on income tax reforms.

In his 2009 speech at the National Tax Conference, Justice Bhandari said that tax laws must be clear and unambiguous.

“The language of the statute must be simple and concise.

“The parliament should legislate long-term taxation policies for ten years or so. The people of this country must be clearly assured the tax policies and tax structure would remain in force at least for a period of ten years so that they can properly plan and arrange their affairs accordingly,” he said.

Justice Bhandari said that there is an urgent need to improve the tax collecting mechanism. “The tax authorities need to be very stern and harsh with people who despite having taxable income are not the assessees but at the same time they must ensure that undue inconvenience and harassment to the honest tax-payers is avoided.”

Tax-payers must be treated with respect by the tax authorities. Bona fide and genuine mistakes or lapses should not lead to prosecution or undue harassment.

An interesting suggestion was that the government must consider that salaried class people be asked to file income-tax return only if they have any other income. “Whatever part of the income the government wants to deduct, it must do so before the payment of salaries. This would avoid inconvenience to a large section of the society and correspondingly the government would be saved of huge staff engaged in collection of taxes from the salaried class employees.”

“The government should adopt pragmatic and prudent approach in tax collection. The government should not spend more money in tax collection process from the people than the actual amount of tax collected. The tax experts must continuously involve in the process of introspection and innovation in order to meet the new challenges thrown by globalization and liberalization. Those who do not innovate are soon discarded,” he added.