ASSOCHAM also called for the decriminalisation of certain TDS defaults, emphasizing the severity of current provisions. It highlighted that Section 276 B imposes a penalty of imprisonment for up to 7 years for individuals who do not adhere to specific TDS regulations.
In its pre-Budget memorandum submitted to the Finance Ministry, ASSOCHAM has proposed the rationalisation of TDS rates by suggesting a uniform rate of either 1% or 2% for all payments made to resident assessees. This proposal aims to reduce disputes caused by differing interpretations and enhance tax compliance.
Please note: According to the Income Tax Act, there are 37 different types of payments made to residents that are subject to varying TDS rates ranging from 0.1% to 30%.
