By AMEET N. PATEL Chartered Accountant
On the occasion of the
launch of the Golden Jubilee year of the venerable BCAJ, I take the liberty of
doing a bit of crystal ball gazing on behalf of the tax professionals of the country.
The objective of this article is only to take a peek at what the future could
possibly have in store for us. Readers are therefore advised to not get into
technicalities. It is the message that counts and not the form.
Part I
The date is 31st
December, 2018. The time is 7.59 pm
Millions of Indians are
glued to their TV sets as their untiring and zealous Prime Minister Mr.
Narendra Damodardas Modi is about to address the nation. Several viewers are
ominously recounting his speech on the night of 8th November, 2016
when he broke the news about demonetisation. Everyone is wondering what will be
announced today.
At sharp 8.00 pm, the PM’s
face appears on TV channels. There is hushed silence as everyone strains to
catch the first words of the PM.
“Mitron”, he begins.
After the customary
pleasantries, he gets down to business and within a few seconds shocks the
nation by saying that “with effect from midnight of 31st December,
2018, there will be no tax on income. The Income-tax Act, 1961 will stand abolished
almost 57 years after it was enacted.”
For a few seconds, there
is stunned silence in all the living rooms in the country. The disbelief is
writ large on the faces of the millions glued to their television sets. But as
reality sinks in, there is chaos everywhere. As expected, people rush to their
mobile phones trying to send messages on all possible types of media. Whatsapp
crashes in a few seconds as millions of messages flood the system. Facebook
comes alive with all kinds of comments and remarks. Twitter suddenly reports
that #incometaxabolished starts trending at No. 1 spot.
As expected, television
news channels go berserk and excited reporters start shouting at the top of
their voices. There is a rush to interview Mr. Subramaniam Swamy who has been
one of the most vociferous proponents of the “abolish income-tax” suggestion.
Some of the business channels also start interviewing the stunned “tax experts”
and “tax gurus” of the country. Most questions revolved around finding out what
these experts/gurus would do once the Income-tax Act is abolished. How will
they keep themselves occupied going forward?
The new year eve parties
all over the country suddenly see a drop in attendance as thousands of affected
tax practitioners try and comprehend the impact of this huge announcement made
by the Prime Minister. The bolt from the blue which most people never expected
would ever come had actually been delivered. And what a timing!
Income-tax Act, 1961
repealed w.e.f. 1st January, 2019! Before becoming a senior citizen
the Act has been given euthanasia by the government. Chartered Accountants all
over the country suddenly open up their offices and start reviewing their
financials for past few years as well as current year. Everyone begins to
estimate how much he/she is likely to lose out in terms of gross revenues once
the Income-tax practice closes down.
There are thousands of
Chartered Accountants in India who have, over the decades, built up a large tax
practice. They have been heavily dependent on the compliance related tax
practice where thousands of tax returns, lakhs of TDS statements etc are filed
year after year. As we all know, in recent years, a large portion of the
traditional income-tax practice of Chartered Accountants has been reduced to a
compliance driven practice. With the advent of automation and e-governance,
e-filing and e-payments have become the order of the day. These have shifted
the focus of people from knowledge to data entry and computerisation. Many
Chartered Accountants who refused to see the writing on the wall,are woken up
from their self imposed slumber. The prospect of their sweat and toil of
several years being on the verge of disintegrating into nothing is real and
even closer to the present than ever imagined! Very few CAs realise that the
way technology is evolving, they could anyways be redundant. Globally, there is
greater acceptance of this fact and those of us who are not upgrading our skill
sets continually, risk being replaced by machines. The ‘routine’ tax practice
is clearly at risk.
Let us take a look at the
list of various categories of people who will be affected by this dramatic
announcement by the Prime Minister:
a) Income-tax practitioners which would include
Chartered Accountants
b) Employees of the Central Government posted in
the Income-tax departments across the country
c) Middlemen who connive with the corrupt and
“fix cases” at the assessment and appellate stages
d) Publishing houses who print thousands of
books every year on taxation
e) Owners of several websites which provide tax
return filing services
f) Lawyers and counsel who provide litigation
services to tax payers and their tax consultants at the various appellate
stages
g) Television channels who spend hours discussing
the Budget and other tax matters alongwith “tax experts” and “tax gurus”
h) Many of us at the Bombay Chartered
Accountants’ Society and other professional bodies who are part of the various
committees that spend so much time on income-tax related programs / articles
etc.
The objective of this
article is merely to prod you, our reader, into sitting up and thinking. Are
you ready for a disruption that threatens to completely change your work
profile? Are you doing anything to hone your skills towards an alternative area
of practice? You have got a
Mediclaim policy to take care of a medical emergency and an insurance policy to
take care of your loved ones in case of the ultimate emergency. But have you
spent even one rupee on providing for a professional emergency – an emergency
of the type that artificial intelligence can bring upon you? Do you even
know that as blockchain technology becomes more and more prevalent and
pervasive, there may come a day when a taxpayer need not even have to file a
tax return? All the data that goes into the return today would anyways be
already available with the government? Who will then come to you for filing
tax returns? What then?
Once e-assessments become
the order of the day, imagine how much time will be saved? Imagine a
possibility that the client will tell you that he does not need you to respond
to the notices. He could sit on his laptop and respond directly to the
notices! You are not required for representing your client before a tax
officer. What then?
Today, almost every piece
of information under the sun is easily traceable on the internet with the help
of Google. For case laws, one does not need to remember citations. One does not
need to subscribe to costly magazines and/or websites. All this is virtually
floating around free of cost on the world wide web! Why would anyone call you
up to ask you about a case law? What then?
Quarterly TDS statements
are basically a compilation of data. Preparing them and filing them does not
require rocket science. All it requires is a reliable data entry operator and a
robust software. Why would a company or a partnership firm come to you for this
service? Can they not outsource this work to a BPO or to a freelance data entry
operator at a fraction of the fees that you would charge? What then?
Such simple examples are
enough to make us think hard about the harsh future ahead. The prospect of the
entire Income-tax Act, 1961 being repealed is definitely something that will
force us to think even harder.
Part II
I took the further liberty
of asking a few people known to me (and to most if not all of you) as to how
they would react to such a situation and how they would deal with this kind of
a change. Every effort has been made to speak to different categories of people
who are likely to be affected by such a change.Their interesting responses will
surely help our readers in understanding how others (who have a lot at stake in
the continuation of the Income-tax Act) would handle disruptive change that may
even do away with the Income-tax Act itself. If their thinking helps our
readers in being in a better state of preparedness for an “Apocalypse Now” type
of situation, this article would have served its purpose. Here’s what some of
the people I spoke to have to say:
Menaka Doshi, Managing Editor, Bloomberg Quint
Question:The
citizens of India are very familiar with your face as we see you regularly in
the media. Your coverage of financial world is well appreciated by thousands. A
major chunk of the discussions that you spearhead in the media are related to
Income-tax. Surely, a lot of your own time as well as that of your team members
would be spent in researching on tax matters and in talking about it.
We want to
know what it would be like for you if the Income-tax Act, 1961 is suddenly
repealed one day! A big section of the content that you thrive on for your
career and your job would suddenly vanish. How would you adapt to this change?
If you were to start preparing for such a change in advance, what would you do?
Menaka Doshi: I can’t tell if your hypothesis is a dream or a
nightmare. Personally, what a pleasant surprise it would be to “take home” my
full salary. Professionally, yes I’d miss covering all the fiscal
ammunition. The big retroactive landmines and the dense language of Section
9, the MAT missile and the LTCG bombs. But I wouldn’t worry about my job. After
all, there is still GST.
T. P. Ostwal (a practicing Chartered Accountant)
Question: As
someone who is very active on the international tax front, what would your
reaction be if, one fine day, we hear an announcement that the Income-tax Act,
1961 is abolished? Do you feel that tax professionals of India would be able to
survive by changing their home ground from India to other countries? Are we equipped
to provide truly international tax advice to foreigners engaged in
international trade even in those cases where the trade does not touch India?
T. P. Ostwal: The thought which you have brought about with this
question is very interesting and I wish that it should happen. I feel that it
would be a very bold decision by the Government to abolish the Income-tax Act.
The abolishment of the Income-tax Act has been immensely advocated by Dr.
Subramanian Swamy and I endorse his views. Unfortunately, neither the
Income-tax department nor the Government of India has the courage to do so. I
wish that they would do so for at least a short period on a trial and error
basis. During such period, they should abolish the Income-tax Act for 5 years
and clean up the whole system similar to the clean up being carried out under
the “Swachh Bharat Abhiyan”. They should allow all the pending assessments
and appeals to be completed in this duration so as to start with a clean slate.
Subsequently they should introduce a simplified Income-tax law with a moderate
rate of tax. In this law, all the receipts should be treated as taxable and all
the expenditure should be allowed as a deduction. As such with the advent of
technology and with Aadhar being linked to everything, taxation of all the
transactions will be streamlined. This will give an opportunity to the people
of India to clean up their records and be straightforward in the future. It
would be pertinent to ensure that the new Income-tax Act is not being
complicated unlike the present system.
And as for your thought
that whether the professionals in India would be able to survive this
abolishment by changing their home ground and shifting to another country, this
thought is virtually an impossible task. Neither are Indian Chartered
Accountants equipped to handle international tax advices where India is the
subject matter of part of the transaction nor can they handle a transaction where
India is not a subject matter at all. If you shift abroad on the premises
that Income-tax Act is abolished and you are going out of the country to advise
the foreigners, it is not an impossible task but we would definitely need to
gear up. There are professionals who have changed their home ground, gone
abroad and integrated themselves with the technical advancements in terms of
the laws of the world and as well advise on laws of the other countries. It is
not an unachievable task, but by and large 99% of our tax professionals are not
equipped to do that.
The Tax experts in India
can be classified in 3 categories
Domestic Tax Experts
Domestic – International
Tax Experts
International –
International Tax Experts
There are various tax
professionals in India who are well equipped to advise the clients and handle
matters within the domestic tax areas and a huge number of these professionals
are specialists. However, there are very few professionals who are specialists
on the Domestic – International tax front. Over a period of time, from 2001,
our tax professionals have gradually achieved proficiency in this field. Almost
10,000 professionals in India can handle Domestic – International tax
transactions. However, whether these 10,000 can handle International –
International tax transactions is questionable. Hardly 25-30 Chartered
Accountants may be in a position to handle international affairs entirely
outside India however, the rest of them may not be able to, in my personal
opinion.
By and large Indian tax
experts who have achieved the proficiency in advising international tax matters
can advise on the Domestic – International tax transactions as well, i.e.
application of Indian tax treaties with other countries. However, they are
neither efficient nor proficient in advising on the laws of the other
countries. This is because they are generally not expected to know the laws of
countries other than India and also practising on the laws of these other
countries may not be permissible. Consequently, they do not have expertise on
that subject.
Nevertheless,
theoretically it is quite possible to equip yourself with the knowledge of laws
of the other countries. Despite the fact that you know the laws of the other
country, the understanding of jurisprudence in that country is equally
important. Since the laws are interpreted in a particular manner by the judges
which could be different from the theoretical legal provision, this knowledge
is also extremely important. Those who keep abreast of the provisions of law
as well as the judicial interpretation in those countries can definitely embark
upon this idea of creating for themselves, professional opportunities abroad.
There are people from the large firms who have shifted abroad to their foreign
affiliates and thereby acquired that proficiency in foreign laws.
Unfortunately, if someone goes abroad for such opportunities they settle there.
Therefore, if I am asked
this question today about the Indian experts practising in India and regarding
their ability to understand and work with these foreign laws with their current
skill set, I have my reservations. I doubt whether there are any people in a
position to do that except for the small number of 25-30 professionals I
mentioned earlier. A situation of abolishment of the Income-tax Act would
create challenges for the practitioners unless they take necessary steps. They
will have to look for other work opportunities, which fortunately, are ample in
a country like India. Taking an example of the recent case of Nirav Modi, a
forensic audit is required for such cases. There are specialists who undertake
such assignments and by becoming little more equipped, the tax professionals in
India can undertake such other assignments in India itself especially with the
ongoing Swachh Bharat Abhiyan of the Government of India, particularly Mr.
Narendra Modi.
Mr. Narendra Modi is
undertaking the responsibility of cleaning up everything and consequently the
entire system is being cleaned up as a part of the Swachh Bharat Abhiyan. I
must compliment and congratulate him and the Government for undertaking the
Swachh Bharat Abhiyan in its true sense. Mr. Modi, is neither compromising nor
allowing anybody to compromise with any of the systems of the Government. For
achieving this, actions are necessary and he is undertaking such actions. Hence
the Chartered Accountants can definitely support the Government of India in its
endeavour for creating a Swachh Bharat by undertaking different and innovative
work rather than just getting bogged down to direct taxation related work. The
field of indirect taxation is humongous, wherein we can help the tax payers and
the Government of India. Further, there are multiple opportunities in the area
of company law and other system oriented work, which are substantial in the
country. We are barely around 2,50,000 Chartered Accountants. When a company
like Tata Consultancy Services has 3,00,000 employees, getting work
opportunities for 1,50,000 Chartered Accountants (assuming that they are
presently involved in direct tax work) in different fields is not at all a
difficult job.
Sonalee Godbole (a practicing Chartered Accountant)
Question:You
practice actively in income-tax matters and handle several large litigations
for your clients. You have also been regularly appearing in the ITAT on behalf
of your clients. What would be your reaction if the Income-tax Act, 1961 is
abolished one day? How would you spend your time once there is no litigation
left on tax matters and nothing is to be represented before the income-tax
authorities?If you had sufficient notice of such an event happening in future,
how would you prepare for it?
Sonalee Godbole: Government generates revenues from levy of
various taxes to meet demands of different stakeholders in the economy and also
to meet its economic development agenda like infrastructure development,
healthcare, education etc. Income tax revenues constitute a large portion of
the overall tax collections. Therefore, it is highly unlikely that the income
tax will be abolished. If it was abolished, it shall be considered as one of
the most radical tax reforms.
If we assume that income
tax is abolished, then the consequential shortfall in income tax revenue will
have to be met through other sources like levy of some other taxes.
Introduction of new taxes will give opportunity and open new area of practice.
Knowing the past history – whenever new laws are introduced in India, due to
drafting inconsistencies, it is open field for litigation. All those who have
experience of litigation practice in the field of Income tax, will have edge
over new entrants. The introduction of new law/laws will keep us busy while we
understand, interpret and litigate.
Simultaneously,
Government will introduce several compliances for the citizens, in order to
ensure that relevant data is collected by the Government. The assignment of
doing compliances on behalf of clients will provide opportunities to
professionals.
If announcement for
abolition of income tax is made by the Government, I will start studying
various other laws which are presently applicable in the country, to look for
opportunities and also look at newly introduced laws. In our CA curriculum, we
are taught to tirelessly study and continuously update our knowledge. This will
certainly help while I explore newer areas of practice. Initially, it may cause
some hiccups but everything would fall in place in long term.
The citizen will bless the
Government for abolishing the income tax. But on a lighter note, students of CA
course will be most happy since, one of the most difficult and lengthy subjects
shall be removed from the curriculum of CA students. Such a relief!
Arun Giri, promoter, Taxsutra
Question:You
have co-founded a highly successful tax portal and have been able to create an
excellent network that goes beyond the cyber world and into the physical world.
Your business model revolves around income-tax related news. Although you do
have an indirect tax related section in your portal, the predominant brand that
you have created for your portal is in the world of income-tax. In this
scenario, how would you react to the abolition of the Income-tax Act by the
government in the near future? How would you deal with a sudden void created by
such an announcement?
Arun Giri: The abolition of income tax is an idea (better
described as ‘fantasy’) that has been advocated by some thinkers in the recent
past. It hasn’t taken off and for good reasons. Be that as it may, we enter the
fantasy land to answer this question!
A black swan event like
this gives one an opportunity to imagine and paint a different canvas … with
no scope of daily tax reporting except to the extent of past litigations, there
will be very little that will excite the Indian tax professional.That being
the case, tax professionals will have to look elsewhere… naturally they will
replace their Indian tax practice with a Asian or global tax practice. Several
hundred Indian tax firms may eye the GCC market, parts of Asian continent or
even Africa where tax laws are new/evolving, hence giving them an opportunity to
learn new tax laws and become proficient tax advisors for tax laws of other
jurisdictions. Taxsutra will be happy to follow the customer and think
‘global.’ We would probably direct our focus towards global tax updates, with
focus on tax jurisdictions which would interest the Indian tax professional.
Associations like the
BCAS, with a glorious history, especially in tax, will also have to conduct
programs to re-skill the Indian tax advisors. Taxsutra shall probably be
partnering BCAS in this endeavour. If such a day were to ever pan out, it will
cause seismic changes in the tax world but what is life without being jolted
out of our comfort zones once in a while!
Kamlesh Varshney, Commissioner of Income Tax (International Taxation)-2
New Delhi
Question:
Sir – you have spent several years in the service of the income-tax department
and have, over the years, risen in rank. Today, you would be heading a team of
several hundred officers and other staff in the income-tax department. Like
you, there would be hundreds of other senior officers with thousands of staff
down the line. Basically, the work that all of you are doing is totally
dependent on what is laid down in the Income-tax Act, 1961. If we suddenly have
a situation where this Act is abolished, how would you and your team react?
Obviously, the government will either have to absorb such a large work force in
other jobs or will be left with no alternative but to seek large scale job
cuts. In either case, what do you think would be the reactions of the affected
people and how would they cope?
Kamlesh Varshney: First of all, I believe that this is a
hypothetical situation, which is unlikely to happen. However, if it happens it
would definitely be a disappointment for the tax administrators since the
wealth of experience they have gained over the years in tax matters and its
implementation would suddenly be lost. So far as job is concerned that would
not be an issue as being in government job, the work force would be absorbed
somewhere else. Having said that, I believe this situation would not arise
since direct tax has a special role to perform. Direct tax is one of the
major instruments for transfer payments (from rich to poor) meeting
socio-economic objective/principles enshrined in our constitution. Consumption
or transaction based tax, though easy to implement, fails to achieve transfer
payments. They are also more burdensome for poor people as they spend
virtually everything that they earn. Hence, for a country like India which
believes in socio-economic objectives/principles, it is virtually impossible
for any Government to abolish income tax.
Milin Mehta (a practicing Chartered Accountant)
Question:You
have been in tax practice for more than 30 years and are a partner in a firm
that was established several decades back. You have an established client base
to whom you are providing various tax services. Lately, this has become more
and more a compliance driven practice. There is already a challenge being faced
by such practitioners from the advent of automation – particularly
practitioners based in smaller towns of India. To add to this, if, one day, the
government decides to abolish the Income-tax Act, how would you react? What
steps do you think you need to take right away so that if such a drastic decision is taken in the near future by the government, you
will be able to continue to practice as a CA?
Milin Mehta: At the very outset I must state that it is a very
interesting thought. I am reminded of my own words a few years ago where I wanted
the participants of the regional conference of WIRC in Mumbai to imagine a
situation where three things happen: (1) No Tax Audits (2) No audit for Private
Limited Companies and (3) No scrutiny assessment. The purpose was to encourage
members to focus on purely “value added services” from compliance oriented. I
encouraged the members at that time to move to services where importance is
given more to the quality of service than merely stamp of being a CA.
I must admit that your
thought goes beyond what I had envisaged.
Let me analyse the
situation from a different angle. In the budget estimate of FY 2018-19, Income
Tax (personal tax, corporate tax and other taxes like STT, etc.) is estimated
at Rs. 11.39 lac crore out of gross revenue receipts (tax and non-tax and
without deducting the share of the state governments from the consolidated fund
of India) of Rs. 27.81 lac crore i.e. approximately 41% of the total gross
revenue. If you exclude the share of the Central Government (CG), this % goes
up to 57 % plus. Therefore, it is impossible to abolish the income tax, without
either substituting it with some other source of revenue or drastically
bringing down the expenditure of the CG.
I as a Chartered
Accountant very strongly feel that in either of the things, the CAs will have
enough work provided we are agile and flexible to re-train or re-orient
ourselves quickly enough to seize the opportunities. Considering the speed with
which our fraternity adapted to a framework change in the indirect taxes in a short
time shows distinctly that we as community are adept at the changes, though we
resist it a lot and many times unnecessarily.
I feel that one of the
reasons why we, as a firm, remained ahead of the pack is that we have adapted
with changes faster than other firms and have seized most of the opportunities.
As a firm, we have taken the principle (and I have been talking to younger
members and others entering the profession about this) that we must consider
that the changes are inevitable and it is only your ability to make yourself
relevant with the changes which would keep you ticking. Therefore, I feel that
I (and so also my fraternity of CAs) are ready to meet with the challenges that
would be thrown if the income tax is abolished and substituted with any other
source of revenues.
Let me look at this from a
further different angle. A large portion of the tax team of any CA office goes
in the area of compliance. Second in line will be representation and
litigation. Very little time is spent in advisory in true sense. Therefore,
majority of the time goes in completely “non-value added services”. The
services in these areas are like necessary evils and completely avoidable. The
question that I ask myself and my team is that “do we want to continue to do such
work?”. The answer is a clear “NO”. I would rather want to utilise my time more
creatively. I would want to devote my time in generating wealth and well being
and not in defending my position all the time.
The abolition of income
tax will free up time of a large number of very capable people, who I am sure
will devote their time in much more creative manner. It would be a shock at the
beginning but things would settle fast and my office and so will be most of the
agile CAs be more gainfully employed. I am not sure whether the income levels
of people will go up or not, but certainly their happiness quotient or their
quotient for contribution to the society will significantly go up.
I am not even slightly
afraid of this situation. In fact, I would welcome such situation as I do not
wish to be engaged in the work which does not produce anything.
Coming specifically to my
organisation, I feel that we are already ready for such challenges to face. The
culture is already developed to expect changes and many times initiate such
changes and challenge the situation and be ready.
Before I end, I would
want to mention that success in our profession does not depend on what you know
but it completely depends on what is your capability of learning. I would
recommend my friends to create that capability and you will be able to face the
challenges of any change, no matter how significant it is, better than your
peers.
Anil Sathe (former editor of BCAJ & a practicing Chartered
Accountant)
Question:You
have been the editor of the BCAJ for several years and have been a member of
the Journal Committee of the BCAS for more than a decade. You are also a senior
tax practitioner. The BCAJ has a very strong coverage of articles and features
relating to income-tax. If, one day, the government decides to abolish the
Income-tax Act, how would you react? What steps do you think you need to take
right away so that if such a drastic decision is taken in the near future by
the government, you will be able to continue to practice as a CA? Also, if you
were to become the editor of BCAJ again, how would the journal look like
without any article or feature relating to income-tax?
Anil Sathe: If income tax is abolished! When I read this
hypothetical announcement, my first reaction was that of shock, then relief,
gradually giving way to concern. My relationship with tax laws is longer than
that with my wife. My tryst with income tax began in 1978 when I began my
articleship. Gradually the liking for tax law grew into a passion. When I started
practice, though I was involved in every traditional area of practice including
accounts and audit, my first love was tax. I still recall the heated
discussions/ deliberations with friends in our office, in BCA study circles and
RRCs. As I started public speaking and writing, tax was the subject that I
chose. In practice I would spend hours in the corridors of Aayakar Bhavan
attending assessments, later appeals and finally in the courtrooms of the
Tribunal. Of course tax practice did result in a significant amount of
frustration when I realised that knowledge, effort and skill had very little
relation with the result which was what the client desired. When I joined the
Journal Committee of the BCAS, meetings were lively with seniors discussing
various tax issues threadbare. As the editor of the BCAJ, I enjoyed reading the
material that was published in each issue. Even today, income tax constitutes
around 40% of the editorial content of the journal. Without knowing it, tax law
has occupied such a position in professional life that it is difficult to
imagine its absence. So what would I do if income tax was abolished?
Yes those long waits, in
the department and in courtrooms would no longer be there. I would not have to
miss family commitments because an important matter was coming up. There would
be sufficient time to spend for myself. But what would I do for a livelihood?
Of course, if Income tax was abolished, the government would have to
necessarily replace it with some other revenue generating mechanism. One would
then have to study that legislation and, if possible, develop expertise in that
area. But all of us have to realise that traditional tax practice in the form
that we have seen it is already on the decline. For more than a decade, we have
seen the change and those who have not had the foresight to change the practice
structure are already suffering. Pure compliance practice has already declined
or shifted to other service providers and this trend would accelerate in the
days to come. Therefore, though abolition of income tax would be a shock for
thousands, the change in the practice landscape has been visible for a long
time. In fact, as professionals, we need to realise that the value addition to
client is in advising about his economic activity rather than in regard to the
output thereof. To a client, a person who advises him on how to increase the
size of the pie is more important than the one who tries to save the pie that
has already been baked. Professionals will have to get into the area of
consulting. Litigation in tax law would undoubtedly continue but would become
so costly that only a few would be able to afford it. So on the personal front,
while even after abolition of tax law, the remaining litigation might suffice
to take me through upto the end of my professional career, my firm would have
to reinvent itself and look to continuously develop the area of business
consulting.
As for the journal, its
contents are a reflection of the needs of readers. It’s information content is
already being challenged by the onslaught of technology with information
reaching the doorstep of the reader much before it is available in the journal.
Therefore, the journal itself will have to undergo a change, even if income tax
were to continue to exist. In its absence, new areas of practice will come to
the fore, and these will fill the void in the journal. In the next decade or
so, I expect the electronic media to completely overtake the print media. This
will have to be understood and appreciated and accepted by future editors of
the journal. The form and content of the journal will undergo a change, but if
it adapts itself to the changing scene in the profession it will retain its
place of eminence.
Part III
A new beginning!
Repeal of the Income-tax
Act, 1961 may or may not happen. Even if it does happen someday, it may be in
the very distant future. The point of this article is not about the
Income-tax Act but about the challenges thrown by disruptive technology that is
fast pervading every aspect of our lives. The objective of this article is to
spur our readers into thinking outside the box.
When we are faced with a
life changing situation, the one important question that stares at us is – “did
I do anything in the past to prepare myself to face such a situation”?
In the hypothetical
situation that I have written about in Part I of this article, we talked about
reactions of people who could be affected by such a situation. In this part of
the article I would like to talk about how we could start preparing ourselves
now so that if any part of our existing practice is disrupted suddenly, we are
not caught napping! The challenge that disruption poses must be converted into
an opportunity by us. Old baggage that has been carried on for many years can
be discarded using this opportunity.
We need to understand and
accept the fact that the practice area that sustained us over the decades will
not continue to do so in the decades ahead. We have to look at alternatives. We
need to spot opportunities around us and start working on them immediately.
There are several emerging areas of practice that are clearly making their
presence felt. We need to start taking interest in them and then start focusing
on a few of them. Some such exciting and interesting areas that one could
consider are:
u Data analytics
u Forensic audit
u Blockchain technology
u Transfer pricing in other countries
u Financial planning and wealth management
u Rehabilitation, insolvency, liquidation
services
u Corporate governance
u Valuation services
u Business / Commercial laws services
u International trade laws
u Climate change and carbon credit
u Inheritance and succession planning
All in all, the objective
of this article is to provoke the reader into action. Our profession needs
to be aware of the disruptive force of technology and change that is sweeping
the globe. We cannot afford to remain in our cocoons any longer. If we are
to survive, we need to accept the change and before that change sweeps us away,
change our course. Just as a boatman regularly adjusts his sails with every
change in the wind, so must we.
I sincerely hope that
readers of BCAJ will contribute to making the golden year of the BCAJ memorable
and momentous by reading every article relating to this theme of “disruption”
and imbibing the spirit behind the articles in their professional and personal
lives and make themselves and their teams ready for change. Unless we change
really fast, we will soon get replaced. The time to act is NOW! 
