New Delhi: “The government is through with the consultation process on the proposed Direct Taxes Code and the contours of the new tax structure could be finalised soon,” finance secretary Ashok Chawala said on Wednesday.
“The process of consultation is almost complete,” Chawla said on the sidelines of a Ficci seminar.
Chawla added that the architecture of the proposed tax code would be finalised by the revenue department and after policymakers give nod to it, the bill on Direct Taxes Code would be drafted by the law ministry.
“Architecture will be finalised by the revenue department, and after the minister and other policy makers have given their green signal, the law ministry would draft the whole thing in the form of framework which is the direct tax code,” Chawla said.
The Direct Taxes Code is likely to be implemented from 2011-12. Sources said that the bill in this respect may be tabled in Parliament in the Budget session.
The government has come out with the draft Direct Taxes Code that is aimed at making tax structure in the country simpler and lower the tax burden by reducing exemptions. It will replace the Income Tax Act 1961.
The government has placed draft of the tax code in public domain for comments. There have been a host of issues in the draft code that have been raised by the industry and individuals at various fora.
The contentious proposals are taxation on withdrawal from long term savings, doing away with tax rebates home loans, changing the criteria for imposition of minimum alternate tax and taxation of foreign companies in India.
Chawla said meanwhile, the work on the budget for next fiscal will continue.
Yesterday, finance minister Pranab Mukherjee started his pre-budget interactions. Industry representatives asked for continuation of stimulus packages for at least six months from the beginning of next fiscal.