This letter addresses the Finance Minister of India, highlighting the need to include Cost and Management Accountants under Section 288(2) of the Income Tax Act. Author claims that current monopoly of Chartered Accountants in tax audits creates obstacles for voluntary compliance and limits the potential contributions of Cost and Management Accountants in this domain.
The letter argues that Cost and Management Accountants possess specialized skills that can complement Chartered Accountants’ capabilities, resulting in more comprehensive tax audits. By allowing Cost and Management Accountants to conduct tax audits, taxpayers will have more choices, leading to greater adherence to tax compliance and increased tax revenues for the government. Inclusivity in the tax audit domain is expected to promote fair competition among professional bodies, improve service quality and efficiency, and enhance the global recognition of the Institute of Cost Accountants of India.
The letter concludes by respectfully requesting the Finance Minister’s consideration to amend Section 288(2) of the Income Tax Act to include Cost and Management Accountants as eligible tax auditors.
FULL TEXT OF THE LETTER IS AS FOLLOWS:-
The Finance Minister Of India,
Ministry of Finance,
Government of India,
New Delhi – 110001
Subject: Inclusion of Cost and Management Accountants in the Definition under Section 288(2) of the Income Tax Act
With due respect, I am writing to bring your attention to a matter that has significant implications for voluntary compliance with the Income Tax Act in India. The Institute of Cost Accountants of India, being the 2nd largest professional body globally, plays a pivotal role in promoting the principles of cost and management accountancy. However, the current tax audit monopoly held by Chartered Accountants under Section 288(2) of the Income Tax Act creates undue hurdles for voluntary compliance and limits the potential contributions of Cost and Management Accountants in this critical domain.
The Institute of Cost Accountants of India, with its vast pool of qualified professionals and their expertise in cost analysis, budgeting, and financial management, can significantly contribute to enhancing the efficiency and effectiveness of tax audits in the country. By including Cost and Management Accountants within the ambit of Section 288(2) of the Income Tax Act, we can foster a more competitive and inclusive environment for tax auditing services while encouraging taxpayers to voluntarily comply with tax laws.
Allow me to present the following points in support of this proposal:
Expertise and Specialization: Cost and Management Accountants possess specialized skills in cost accounting, budgetary control, and financial management. Their expertise would complement the existing capabilities of Chartered Accountants and lead to more comprehensive tax audits.
Encouraging Voluntary Compliance: With a broader pool of qualified professionals, taxpayers would have more choices in selecting tax auditors. This competitive environment would foster greater adherence to tax compliance, leading to increased tax revenues for the government.
Promoting Fair Competition: Inclusivity within the tax audit domain will encourage fair competition among professional bodies, leading to improved service quality and efficiency.
Global Recognition: The Institute of Cost Accountants of India has achieved international recognition, with members contributing significantly to the global financial and management accounting landscape. Inclusion within the Income Tax Act would further enhance their standing and promote their expertise.
In light of these points, I respectfully request your kind consideration to amend Section 288(2) of the Income Tax Act to include Cost and Management Accountants as eligible tax auditors. This step would not only bolster voluntary compliance but also unlock the potential of skilled professionals in the cost and management accounting domain for the benefit of the Indian economy.
I am confident that your esteemed leadership and foresight will help create an environment conducive to the growth and progress of the financial sector in India. Your support in this matter will be highly appreciated by the Institute of Cost Accountants of India and its members.
Thank you for your time and attention to this crucial matter. I am available at your convenience to discuss this proposal further.
With utmost respect,
Rakesh Bansal Adv