CA Kamal Garg
(A). Taxation of income by way of dividend: Any income by way of dividend in excess of Rs. 10 lakh shall be chargeable to tax in the case of an individual, Hindu undivided family (HUF) or a firm who is resident in India, at the rate of 10%. This amendment is proposed because of the vertical inequity amongst the tax payers as those who have high dividend income are subjected to tax only at the rate of 15% whereas such income in their hands would have been chargeable to tax at the rate of 30%. The government has introduced this to plug in a tax arbitrage which the rich shareholders enjoyed. The tax rate for individuals earning more than Rs 10 lakh is 30 per cent and above. Those in the top tax bracket earning an income of more than Rs 1 crore pay a higher surcharge, bringing the tax rate to 35.54 per cent. As dividend was tax free in the hands of all shareholders, including those falling in the 30% plus tax bracket, whereas the DDT was only 20%, the government lost out owing to the tax differential. In case of Wipro for instance, Azim Premji and his family members hold 3.86 per cent in the company as of March 31, 2015. Azim Premji, chairperson of the company, in his personal capacity held 9.34 crore shares (or 3.78%) of the total shareholding. Together with trusts and other entities, the promoter holding is much higher at 73.39%. Wipro declared an interim dividend of Rs. 5 per share and a final dividend of Rs. 7 per share (Rs. 2,964 crore) during FY 2014-15. Azim Premji, thus would have earned a tax free dividend of Rs. 112.08 crore.
(B). Google Tax: India has taken the first step to tax the digital economy. An equalisation levy–a deduction of 6% to be made by an Indian payer on payments to a nonresident entity for specified B2B services such as advertising—has been introduced in the Budget. The levy will impact the bottom lines of giants such as Google, Yahoo and others, which earn ad revenue from business entities in India. In professional tax circles, it has been dubbed `Google tax’. Its introduction is the outcome of a tough battle which India faced during the Base Erosion and Profit Shifting Project (BEPS) discussions, a project spearheaded by the Organisation for Economic Co-operation and Development (OECD). The project aims to bring G20 countries on a single platform to introduce measures to ensure tax transparency and curb avoidance by multinationals (MNCs) through aggressive tax planning. India appears to have won the first round of the battle by introducing the equalisation levy.
(C). Exemption from requirement of furnishing PAN under section 206AA to certain non-resident: The existing provision of section 206AA, inter alia, provides that any person who is entitled to receive any sum or income or amount on which tax is deductible under Chapter XVIIB of the Act shall furnish his Permanent Account Number to the person responsible for deducting such tax, failing which tax shall be deducted at the rate mentioned in the relevant provisions of the Act or at the rate in force or at the rate of twenty per cent., whichever is higher. The provisions of section 206AA also apply to non-residents with an exception in respect of payment of interest on long-term bonds as referred to in section 194LC. In order to reduce compliance burden, it is proposed to amend the said section 206AA w.e.f. 1st June 2016, so as to provide that the provisions of this section shall also not apply to a non-resident, not being a company, or to a foreign company, in respect of any other payment, other than interest on bonds, subject to such conditions as may be prescribed.
(D). TCS on sale of vehicles; goods or services: In order to reduce the quantum of cash transaction in sale of any goods and services and for curbing the flow of unaccounted money in the trading system and to bring high value transactions within the tax net, it is proposed to amend section 206C of the Income Tax Act, 1961, to provide that the seller shall collect the tax at the rate of one per cent from the purchaser on sale of motor vehicle of the value exceeding Rs. 10 Lakhs and sale in cash of any goods (other than bullion and jewellery), or providing of any services (other than payments on which tax is deducted at source under Chapter XVII-B) exceeding Rs. 2 Lakhs.
(E). Levy of “exit-tax” where the charitable institution ceases to exist or converts into a non-charitable organization: A society or a company or a trust or an institution carrying on charitable activity may voluntarily wind up its activities and dissolve or may also merge with any other charitable or non-charitable institution, or it may convert into a non-charitable organization. In such a situation, the existing law does not provide any clarity as to how the assets of such a charitable institution shall be dealt with. Under provisions of section 11 certain amount of income of prior period can be brought to tax on failure of certain conditions. However, there is no provision in the Act which ensure that the corpus and asset base of the trust accreted over period of time, with promise of it being used for charitable purpose, continues to be utilised for charitable purposes and is not used for any other purpose. In the absence of a clear provision, it is always possible for charitable institutions to transfer assets to a non-charitable institution. There is a need to ensure that the benefit conferred over the years by way of exemption is not misused and to plug the gap in law that allows the charitable trusts having built up corpus/wealth through exemptions being converted into non-charitable organisation with no tax consequences. In order to ensure that the intended purpose of exemption availed by trust or institution is achieved, a specific provision in the Act is required for imposing a levy in the nature of an exit tax which is attracted when the organization is converted into a non-charitable organization or gets merged with a non-charitable organization or does not transfer the assets to another charitable organisation.
(F). Phasing out of deductions and exemptions: The Finance Minister in his Budget Speech, 2015 has indicated that the rate of corporate tax will be reduced from 30% to 25% over the next four years along with corresponding phasing out of exemptions and deductions. The Government proposed to implement this decision in a phased manner.
1. Section 35AC-Expenditure on eligible projects or schemes: At present a deduction is available for expenditure incurred by way of payment of any sum to a public sector company or a local authority or to an approved association or institution, etc. on certain eligible social development project or a scheme. Now it is proposed that no deduction shall be available with effect from 1.4.2017 (i.e. from previous year 2017-18 and subsequent years).
2. Section 35CCD-Expenditure on skill development project: Weighted deduction of 150 per cent on any expenditure incurred (not being expenditure in the nature of cost of any land or building) on any notified skill development project by a company is available u/s 35CCD at present. It is now being proposed that the deduction shall be restricted to 100 per cent from 01.04.2020 (i.e. from previous year 2020-21 onwards).
3. Section 80IA; 80IAB, and 80IB: 100 per cent profit linked deductions is available at present for specified period on eligible business (i.e. (a) development, operation and maintenance of an infrastructure facility (80-IA), (b) development of special economic zone (80-IAB), (c) production of mineral oil and natural gas [80-IB(9)] carried on by industrial undertakings or enterprises referred in section 80IA; 80IAB, and 80IB. It is now being proposed that no deduction shall be available if the specified activity commences on or after 1st day April, 2017. (i.e. from previous year 2017-18 and subsequent years).
4. Section 32 read with rule 5 of Income-tax Rules, 1962- Accelerated Depreciation: As per the extant provisions, accelerated depreciation is provided to certain Industrial sectors in order to give impetus for investment. The depreciation under the Income-tax Act is available up to 100% in respect of certain block of assets. It is now being proposed to amend the new Appendix IA read with rule 5 of Income-tax Rules, 1962 to provide that highest rate of depreciation under the Income-tax Act shall be restricted to 40% w.e.f 01.4.2017. (i.e. from previous year 2017-18 and subsequent years). The new rate is proposed to be made applicable to all the assets (whether old or new) falling in the relevant block of assets.
5. Section 35(1) – Expenditure on scientific research: The present scheme and proposals are outlined below:
|(a).||35(1)(ii)- Expenditure on scientific research.||Weighted deduction from the business income to the extent of 175 per cent of any sum paid to an approved scientific research association which has the object of undertaking scientific research. Similar deduction is also available if a sum is paid to an approved university, college or other institution and if such sum is used for scientific research.||Weighted deduction shall be restricted to 150 per cent from 01.04.2017 to 31.03.2020 (i.e. from previous year 2017-18 to previous year 2019-20) and deduction shall be restricted to 100 per cent from 01.04.2020 (i.e. from previous year 2020-21 onwards).|
|(b).||35(2AA)- Expenditure on scientific research.||Weighted deduction from the business income to the extent of 200 per cent of any sum paid to a National Laboratory or a university or an Indian Institute of Technology or a specified person for the purpose of approved scientific research programme.||Weighted deduction shall be restricted to 150 per cent with effect from 01.04.2017 to 31.03.2020 (i.e. from previous year 2017-18 to previous year 2019-20).
Deduction shall be restricted to 100 per cent from 01.04.2020 (i.e. from previous year 2020-21 onwards).
|(c).||35(2AB)- Expenditure on scientific research.||Weighted deduction of 200 per cent of the expenditure (not being expenditure in the nature of cost of any land or building) incurred by a company, engaged in the business of bio-technology or in the business of manufacture or production of any article or thing except some items appearing in the negative list specified in Schedule-XI, on scientific research on approved in-house research and development facility.||Weighted deduction shall be restricted to 150 per cent from 01.04.2017 to 31.03.2020 (i.e. from previous year 2017-18 to previous year 2019-20).
Deduction shall be restricted to 100 per cent from 01.04.2020 (i.e. from previous year 2020-21 onwards).
|(d).||35AD- Deduction in respect of specified business.||In case of a cold chain facility, warehousing facility for storage of agricultural produce, an affordable housing project, production of fertilizer and hospital weighted deduction of 150 per cent of capital expenditure (other than expenditure on land, goodwill and financial assets) is allowed.||In case of a cold chain facility, warehousing facility for storage of agricultural produce, hospital, an affordable housing project, production of fertilizer, deduction shall be restricted to 100 per cent of capital expenditure w.e.f. 01.4.2017 (i.e. from previous year 2017-18 onwards).|
(G). Initial additional depreciation under section 32(1)(iia) for power sector: Under the existing provisions of section 32(1)(iia) of the Act, additional depreciation of 20% is allowed in respect of the cost of new plant or machinery acquired and installed by certain assessees engaged in the business of generation and distribution of power . This depreciation allowance is over and above the deduction allowed for general depreciation under section 32(1)(ii) of the Act. Under the existing provisions, the benefit of additional depreciation is not available on the new machinery or plant installed by an assessee engaged in the business of transmission of power. In order to rationalise the incentive of power sector, it is proposed to amend this section so as to provide that an assessee engaged in the business of transmission of power shall also be allowed additional depreciation at the rate of 20% of actual cost of new machinery or plant acquired and installed in a previous year.
(H). Royalty Tax: The Budget has introduced a special ‘royalty tax’ which lowers the effective rate of tax on income earned from patents. The objective is to encourage indigenous research and development, and to make India an innovation hub. The benefit will be available across knowledge-based sectors of the economy, including pharmaceuticals. The FM proposed a special patent regime with a 10% rate of tax on income from worldwide commercialization of patents which are developed and registered in India. Usually, the domestic company which has commercialized the patent would be paying tax from income at the standard rate of 30% after deducting expense. With this proposal, the tax liability on income from commercialization of patents goes down, and thus would be beneficial for knowledge-based firms and it would also reduce the outflow of intellectual property from India. The government hopes it will also encourage domestic companies across sectors, including automotive, electronics and pharmaceuticals, to locate high-value jobs associated with the development, manufacture and exploitation of patents in the country. It will help knowledge-based sectors to continue with the research on the patent, licenced in the country, to develop it indigenously, and not out-licence it to a foreign firm. For example, certain pharma companies in the past like Dr Reddy’s and Glenmark had cut deals with MNCs involving their novel drug molecules, to develop them further and commercialize them. For the purpose of this concessional tax regime, an eligible assessee means a person resident in India, who is the true and first inventor of the invention and whose name is entered on the patent register as the patentee in accordance with Patents Act, 1970. These amendments will take effect from April 1, 2017 and will, accordingly, apply in relation to the assessment year 2017-18 and subsequent years, the proposal says.
(I). Tax incentives for start-ups: With a view to providing an impetus to start-ups and facilitate their growth in the initial phase of their business, it is proposed to provide a deduction of 100% of the profits and gains derived by an eligible start-up from a business involving innovation development, deployment or commercialization of new products, processes or services driven by technology or intellectual property. The benefit of hundred percent deduction of the profits derived from such business shall be available to an eligible start-up which is setup before 01.04.2019.
Further, in order to promote the start-up ecosystem in the country, it is envisaged in ‘start-up India Action Plan’ to establish a Fund of Funds which intends to raise Rs 2500 crores annually for four years to finance the start-ups. Keeping this objective in view, it is proposed to insert a new Section 54EE to provide exemption from capital gains tax if the long term capital gains proceeds are invested by an assessee in units of such specified fund, as may be notified by the Central Government in this behalf, subject to the condition that the amount remains invested for three years failing which the exemption shall be withdrawn. The investment in the units of the specified fund shall be allowed up to Rs. 50 lakh. The existing provisions of section 54GB provide exemption from tax on long term capital gains in respect of the gains arising on account of transfer of a residential property, if such capital gains are invested in subscription of shares of a company which qualifies to be a small or medium enterprise under the Micro, Small and Medium Enterprises Act, 2006 subject to other conditions specified therein. With an objective to provide relief to an individual or HUF willing to setup a start-up company by selling a residential property to invest in the shares of such company, it is proposed to amend section 54GB so as to provide that long term capital gains arising on account of transfer of a residential property shall not be charged to tax if such capital gains are invested in subscription of shares of a company which qualifies to be an eligible start-up subject to the condition that the individual or HUF holds more than 50% shares of the company and such company utilises the amount invested in shares to purchase new asset before due date of filing of return by the investor.
The existing provision of section 54GB requires that the company should invest the proceeds in the purchase of new asset being new plant and machinery but does not include, inter-alia, computers or computer software. With a view to avoid the incidence of the aforesaid condition on start-ups where computers or computer software form the core asset base owing to nature of business activity, it is proposed to amend section 54GB so as to provide that the expression “new asset” includes computers or computer software in case of technology driven start-ups so certified by the Inter-Ministerial Board of Certification notified by the Central Government in the official Gazette.
(J). Presumptive taxation scheme for persons having income from profession: The existing scheme of taxation provides for a simplified presumptive taxation scheme for certain eligible persons engaged in certain eligible business only and not for persons earning professional income. In order to rationalize the presumptive taxation scheme and to reduce the compliance burden of the small tax payers having income from profession and to facilitate the ease of doing business, it is proposed to provide for presumptive taxation regime for professionals. In this regard, new section 44ADA is proposed to be inserted in the Act to provide for estimating the income of an assessee who is engaged in any profession referred to in sub-section (1) of section 44AA such as legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or any other profession as is notified by the Board in the Official Gazette and whose total gross receipts does not exceed fifty lakh rupees in a previous year, at a sum equal to 50% of the total gross receipts, or, as the case may be , a sum higher than the aforesaid sum earned by the assessee. The scheme will apply to such resident assessee who is an individual, Hindu undivided family or partnership firm but not Limited Liability partnership firm. Under the scheme, the assessee will be deemed to have been allowed the deductions under section 30 to 38. Accordingly, the written down value of any asset used for the purpose of the profession of the assessee will be deemed to have been calculated as if the assessee had claimed and had actually been allowed the deduction in respect of depreciation for the relevant assessment years. It is also proposed that the assessee will not be required to maintain books of account under sub-section (1) of section 44AA and get the accounts audited under section 44AB in respect of such income unless the assessee claims that the profits and gains from the aforesaid profession are lower than the profits and gains deemed to be his income under sub-section (1) of section 44ADA and his income exceeds the maximum amount which is not chargeable to income-tax.
(K). Increase in threshold limit for audit for persons having income from profession: Under the existing provisions of section 44AB of the Act every person carrying on a profession is required to get his accounts audited if the total gross receipts in a previous year exceed twenty five lakh rupees. In order to reduce the compliance burden, it is proposed to increase the threshold limit of total gross receipts, specified under section 44AB for getting accounts audited, from twenty five lakh rupees to fifty lakh rupees in the case of persons carrying on profession.
(L). Investment allowance under section 32AC: The existing provision of sub-section (1A) in section 32AC of the Act provides for investment allowance at the rate of 15% on investment made in new assets (plant and machinery) exceeding Rs. 25 crores in a previous year by a company engaged in manufacturing or production of any article or thing subject to the condition that the acquisition and installation has to be done in the same previous year. This tax incentive is available up to 31.03.2017. The dual condition of acquisition and installation causes genuine hardship in cases in which assets having been acquired could not be installed in same previous year. It is proposed to amend the sub-section (1A) of section 32AC so as to provide that the acquisition of the plant & machinery of the specified value has to be made in the previous year. However, installation may be made by 31.03.2017 in order to avail the benefit of investment allowance of 15%. It is further proposed to provide that where the installation of the new asset is in a year other than the year of acquisition, the deduction under this sub-section shall be allowed in the year in which the new asset is installed. These amendments will take effect retrospectively from 1 April, 2016 and will, accordingly, apply in relation to the assessment year 2016-17 and 2017-18.
(M). The Income Declaration Scheme, 2016: An opportunity is proposed to be provided to persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty totaling in all to 45% of such undisclosed income declared. The scheme is proposed to be brought into effect from 1 June 2016 and will remain open up to the date to be notified by the Central Government in the official gazette. The scheme is proposed to be made applicable in respect of undisclosed income of any financial year upto 2015-16. Tax is proposed to be charged at the rate of 30% on the declared income. A penalty at the rate of twenty five per cent of tax payable is also proposed to be levied on undisclosed income declared under the scheme. It is proposed that following cases shall not be eligible for the scheme:
It is proposed that payment of tax, surcharge and penalty may be made on or before a date to be notified by the Central Government in the Official Gazette and non-payment up to the date so notified shall render the declaration made under the scheme void.
It is proposed to provide that declarations made under the scheme shall be exempt from wealth-tax in respect of assets specified in declaration. It is also proposed that no scrutiny and enquiry under the Income-tax Act and Wealth-tax Act be undertaken in respect of such declarations and immunity from prosecution under such Acts be provided. Immunity from the Benami Transactions (Prohibition) Act, 1988 is also proposed for such declarations subject to certain conditions. It is proposed to provide that where a declaration under the scheme has been made by misrepresentation or suppression of facts, such declaration shall be treated as void. It is also proposed that nothing contained in the Scheme shall be construed as conferring any benefit, concession or immunity on any person other than the person making the declaration under this Scheme. In cases where any declaration has been made but no tax and penalty referred to the scheme has been paid within the time specified, the undisclosed income shall be chargeable to tax under the Income-tax Act in the previous year in which such declaration is made. In cases where any income has accrued, arisen or received or any asset has been acquired out of such income prior to commencement of this Scheme, and no declaration in respect of such income is made under the Scheme such income shall be deemed to have accrued, arisen or received, or the value of the asset acquired out of such income shall be deemed to have been acquired or made, in the year in which a notice under section 142, section 143(2) or section 148 or section 153A or section 153C of the Income-tax Act is issued by the Assessing Officer and the provisions of the Income-tax Act shall apply accordingly. It is further proposed that if any difficulty arises in giving effect to the provisions of this Scheme, the Central Government may, by order, not inconsistent with the provisions of this Scheme, remove the difficulty by an order not after the expiry of a period of two years from the date on which the provisions of this Scheme come into force and such order be laid before each House of Parliament.
It is proposed that the Central Board of Direct Taxes under the control of Central Government be provided the power to make rules, by notification in the Official Gazette, for carrying out the provisions of this Scheme and such rules made be laid before each House of Parliament in the manner provided in the scheme.
(N). Automation of various processes and paperless assessment: Sub-section (1) of section 282A provides that where a notice or other document is required to be issued by any income-tax authority under the Act, such notice or document should be signed by that authority in manuscript. It is proposed to amend sub-section (1) of section 282A so as to provide that notices and documents required to be issued by income-tax authority under the Act shall be issued by such authority either in paper form or in electronic form in accordance with such procedure as may be prescribed. Sub-section (2) of section 143 provides that, if the Assessing Officer considers it necessary and expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, he shall serve on the assessee a notice requiring him to produce, or cause to be produced on a specified date, any evidence on which the assessee may rely in support of the return. In order to ensure timely service of notice issued under sub-section (2) of section 143, it is proposed to amend sub-section (2) of section 143 to provide that notice under the said sub-section may be served on the assessee by the Assessing Officer or the prescribed income-tax authority, either to attend the office of the Assessing Officer or to produce, or cause to be produced before the Assessing Officer any evidence on which the assessee may rely in support of the return. It is also proposed to amend the existing provision of section 2 by inserting new clause (23C) to define the term “hearing” to include communication of data and documents through electronic mode.
(O). Extension of scope of section 43B to include certain payments made to Railways: The existing provisions of section 43B of the Act, inter alia, provide that any sum payable by the assessee by way of tax, cess, duty or fee, employer contribution to Provident Fund, etc., is allowable as deduction of the previous year in which the liability to pay such sum was incurred (relevant previous year) if the same is actually paid on or before the due date of furnishing of the return of income irrespective of method of accounting followed by a person. With a view to ensure the prompt payment of dues to Railways for use of the Railway assets, it is proposed to amend section 43B so as to expand its scope to include payments made to Indian Railways for use of Railway assets within its ambit.
(P). Taxation of Non-compete fees and exclusivity rights in case of Profession: The existing provision of clause (va) of section 28 of the Act includes within the scope of “profit and gains of business or profession” any sum received or receivable in cash or in kind under an agreement for not carrying out activity in relation to any business; or not to share any know how, patent, copyright, trade mark, licence, franchise or any other business or commercial right of similar nature or information or technique likely to assist in the manufacture or processing of goods or provision for services and is chargeable to tax as business income. Further, the provisions clarify that receipts for transfer of right to manufacture, produce or process any article or thing or right to carry on any business, which are chargeable to tax under the head “Capital gains”, would not be taxable as profits and gains of business or profession. Under section 45 of the Act, any capital receipt arising out of transfer of any business or commercial rights is taxable under the head “Capital gains”. The amount of “Capital gains” is computed according to section 48 of the Act. For this purpose, ‘cost of acquisition’ and ‘cost of improvement’ are defined under section 55. However, non-compete fee received/receivable in relation to carrying out of profession are not covered under these provisions. It is proposed to amend clause (va) of section 28 of the Act to bring the non-compete fee received/ receivable( which are recurring in nature) in relation to not carrying out any profession, within the scope of section 28 of the Act i.e. the charging section of profits and gains of business or profession. Further, it is also proposed to amend the proviso to clarify that receipts for transfer of right to carry on any profession, which are chargeable to tax under the head “Capital gains”, would not be taxable as profits and gains of business or profession. It is also proposed to amend section 55 so as to provide that the ‘cost of acquisition’ and ‘cost of improvement’ for working out “Capital gains” on capital receipts arising out of transfer of right to carry on any profession shall also be taken as ‘nil’.
(Q). Sale consideration is fixed under agreement executed prior to the date of registration of immovable property: Under the existing provisions contained in Section 50C, in case of transfer of a capital asset being land or building on both, the value adopted or assessed by the stamp valuation authority for the purpose of payment of stamp duty shall be taken as the full value of consideration for the purposes of computation of capital gains. The Income Tax Simplification Committee (Easwar Committee) has in its first report, pointed out that this provision does not provide any relief where the seller has entered into an agreement to sell the property much before the actual date of transfer of the immovable property and the sale consideration is fixed in such agreement, whereas similar provision exists in section 43CA of the Act i.e. when an immovable property is sold as a stock-in-trade. It is proposed to amend the provisions of section 50C so as to provide that where the date of the agreement fixing the amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty value on the date of the agreement may be taken for the purposes of computing the full value of consideration. It is further proposed to provide that this provision shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by way of an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account, on or before the date of the agreement for the transfer of such immovable property.
(R). Filing of return of Income: In order to rationalise the time allowed for filing of returns, completion of proceedings, and realization of revenue without undue compliance burden on the taxpayer, and to promote the culture of compliance, it is proposed to amend w.e.f. 1st April, 2017, the provisions of Section 139 of the Act as follows:
(S). Tax penalties fixed to end harassment: In a move to usher in a non adversarial tax regime, the FM has decided to classify tax defaulters into two distinct categories — those who have under-reported income and those who have misreported. The discretion available to tax officials to levy penalty between 100% and 300% of the tax will be taken away. This will reduce litigation. The proposed penalty provision, Section 270A, levies a fine of 200% of the tax, in case of misreporting of income, and 50% of tax in case of under-reporting. Currently, no penalty is levied where the tax official is satisfied that there was a genuine mistake. Similarly, a fine is not leviable where the addition made by an official to a taxpayer’s income is owing to a genuine difference in the interpretation of laws. Such cases would now not fall outside the purview of penalty. This could lead to litigation. Budget proposes to rationalise interest on refund from June 1. If a return is filed late, the taxpayer will get interest only from the date of filing of the return.
In case of self-assessment, the taxpayer will get interest on refunds either from the date of tax payment or filing of the return, whichever is later. In case of a dispute, the taxpayer is entitled to an additional 3% interest per year from the date on which the order on the appeal is to take effect.