As of now, the Central Board of Direct Taxes
(CBDT) and Central Board of Indirect Taxes and Customs (CBIC) have independent financial powers to decide how much they would spend on tax generation.
The Tax Administration Reform Commission, under Parthasarthi Shome, the then advisor to the finance minister, had first suggested, in 2014, merging these two boards. The CBIC
was then called the Central Board of Excise and Customs.
Since then the proposal has been taken up in various fora. Its 550-page report had said the two boards must embark on “selective convergences immediately to achieve better tax governance, and, in the next five years, move towards a unified management structure with a common board for both direct and indirect taxes”.
member Akhilesh Ranjan said: “Theoretically this can be done. Several countries like the UK have a unified service. But considering the administrative formations that we have for income tax (I-T), Customs, and goods and services tax (GST) separately, it will mean a lot of upheaval without much benefit. Also, the GST set-up is distinct, with the GST Council setting policy.”
At present, the two boards draft tax policies, and the Department of Revenue handles the budgets for carrying out their functions.
Besides, they share data, helping them in spotting income anomalies or mismatches between GST filings and I-T returns.
Further, creating posts will be reviewed. Apart from freezing new jobs, the two boards are looking at those created in the past two years. Those that lie vacant may not be filled.
Recently, the CBDT
instructed its heads of departments to limit key expenditures. Or else, certain future expenditures, including those on legal matters, write-off losses, repair and maintenance costs, and rewards to informants, may not be sanctioned.
Reducing entrants to the IRS, both for Customs and I-T, is being considered. Generally, the government informs the Union Public Service Commission every year how many it needs. Sources say this year the recruitment to the IRS has been reduced to half of that of last year.
However, the number of IRS vacancies will be known after the results of the civil services examination come out. In 2019, 60 I-T officers had been recruited, against 65 in 2018 and 169 in 2017.
An email sent to CBDT
(DPR Finance) on Saturday with specific query on merger remained unanswered.
and the Central Board of Indirect Taxes and Customs, according to a statement issued by the Press Information Bureau on Monday. While the merger was one of the recommendations of the Tax Administrative Reforms Commission, the government had not accepted it, the statement added.