The Union Finance Ministry on Monday sought public inputs and suggestions for a revision of the Income Tax Act, which was announced in this year’s budget.
Comments were requested in four categories: simplifying language, reducing litigation, reducing compliance, and redundant/outdated provisions.
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The Central Board of Direct Taxes (CBDT), under the ministry, has constituted an internal committee to monitor the review.
“The aim is to make the law concise, clear and easy to understand, which will reduce the number of disputes and lawsuits and provide taxpayers with greater tax certainty,” the Treasury Department said in a statement.
However, details about the committee were not given.
Union Finance Minister Nirmala Sitharaman announced a revision of the law in her budget speech this year.
“Our aim has been to simplify taxation. We have taken a number of measures in recent years, including the introduction of simplified tax regimes without exemptions and deductions for corporate tax and personal income tax. This was appreciated by the taxpayers. 58 percent of corporate taxes came from the simplified tax regime in the 2022-2023 financial year. “Similarly, according to the data available so far for the last financial year, over two-thirds have availed themselves of the new personal income tax regime,” she said.
The ministry statement said: “Suggestions should specify the relevant provision of the Income-tax Act, 1961 or Income-tax Rules, 1962 (mentioning the specific section, sub-section, clause, rule, sub-rule or form number), whether as the case may be, to which the suggestion relates under the above four categories.”
Tax experts believe that the government’s initiative supports transparency in tax policymaking.
“Not only is this an unprecedented opportunity for companies to participate in the evolving tax legislation that will govern them in the future, it will also provide policymakers with sufficient breadth in their formulation approach. The upcoming tax legislation will be a key pillar of India’s ambitious macroeconomic future, and it is of paramount importance that the process involved in developing this legislation is thorough, transparent and valuable,” said Sumit Singhania, Partner at Deloitte India.
Maneesh Bawa, partner at Nangia Andersen India, said: “This crowdsourced approach aims to address the practical challenges faced by taxpayers, accountants and legal professionals, and ensure that their real-world experiences help shape the reforms.”
First publication: Oct 07, 2024 | 11:06 PM IST