The scheme announced in the union budget for FY21, for which the Bill is pending in Parliament, allows beneficiaries to pay disputed tax arrears without interest and penalty if paid before 31 March. In case the tax dispute is over penalty, interest or fee, the settlement amount payable is 25% of the dues if paid before the end of March. There will be a marginal increase in dues to be paid if the tax payer signs up for the scheme after March but before end of June.

The government earlier in the week approved changes to the scheme to sweeten the terms and expand its coverage. The Indian Express report said, quoting an official communication to field officers, that the performance of the tax department in implementing the scheme will be “specifically commented upon by the reporting and the reviewing officers and shall be an important factor in determining their future postings".