This article discusses the complexities of TDS/TCS provisions and suggests reforms for the upcoming Union Budget to streamline compliance, reduce disputes, and foster clarity. Key recommendations include:
‣ Standardise TDS Rates – Introduce a three-tier rate structure (1%, 10%, 30%) for different transaction types
‣ Consolidate TDS Provisions – Create a single comprehensive schedule for rates and thresholds
‣ Address Common Disputes – Exclude GST components, out-of-pocket expenses, and year-end provisions from TDS requirements
‣ Simplify Compliance for Small Businesses – Allow PAN usage instead of TAN for minimal TDS transactions
‣ Faceless Process for Certificates – Implement an AI-driven, online system for issuing lower deduction certificates
These reforms aim to make TDS provisions more efficient and taxpayer-friendly, aligning with budgetary goals.
