New Delhi, Aug 12 (Inditop.com) The following are some salient features pertaining to the new Direct Tax Code proposed by the government, for which a draft and a discussion paper were released by Finance Minister Pranab Mukherjee Wednesday:
What does it seek: The Direct Tax Code will replace the existing Income Tax Act that was enacted in 1961, which had replaced an earlier legislation of 1922 enacted prior to the country’s independence.
When will it be introduced: The government intends to present the relevant bill during the winter session of parliament, after considering and incorporating, if seen fit, the opinions on its provisions from the public. The government hopes it will become law in 2011.
The main purpose: The new code will completely overhaul and simplify the existing tax proposals for not only individual tax payers, but also corporate houses and foreign residents.
How will it help: The idea is to keep the provisions simple so that even an average taxpayer can understand the language, than having to go to chartered accountants and income tax practitioners. It will also introduce the concept of tax calculators.
Administrative reforms: The new code will also recast the powers of the Central Board of Direct Taxes, induce more transparency in decision-making and tune it to tax boards of countries like the US, Canada and Britain.
What can the public do: The finance ministry has uploaded on its website – www.finmin.nic.in – the draft direct tax code, a discussion paper, a comment on the code and what rating people would like to give to it.
