New direct tax code draft by July-end1 min read . Updated: 24 May 2019, 09:55 PM IST
- Finance minister Arun Jaitley extends deadline till 31 July for a task force to come up with a new draft direct tax code
- The proposed new direct tax code will replace the Income Tax Act of 1961
NEW DELHI : The government on Friday gave two months extra time to a task force comprising tax officials and outside experts to come up with a new draft direct tax code.
Finance minister Arun Jaitley extended the deadline till 31 July at a meeting of secretaries in the ministry, said a person with direct knowledge of the matter.
Friday’s decision on the tax code is one of the final decisions of the current government led by Prime Minister Narendra Modi before the new cabinet is constituted following the national polls. President of India Ram Nath Kovind on Friday accepted the resignation of Modi and the council of ministers and requested them to continue till the next government assumed office.
The proposed new direct tax code will replace the Income Tax Act of 1961. The existing direct tax law, which deals with personal income tax, corporate tax and other levies such as the capital gains tax, has undergone numerous changes over the years. The government wants to rewrite it in line with the economic needs of the country and to keep pace with evolving global best practices. One key consideration in the exercise is to improve tax compliance. It will seek to bring more assessees into the tax net and make the system more equitable for different classes of taxpayers. It may also try to make businesses more competitive by lowering the corporate tax rate and phase out the remaining tax exemptions that lead to litigation.