Opinion | Some tax relief for our corporate sector2 min read . Updated: 20 Aug 2019, 10:20 PM IST
A low rate of corporate tax should apply to all companies in India, big or small, as a panel on direct taxes has recommended. This would help India Inc. turn globally competitive
The long-awaited changes in India’s over half-a-century-old income tax rules may finally be upon us—perhaps by the next fiscal year. A panel set up by the government to review the direct tax code (DTC) has submitted its report. If implemented, its recommendations would supplant the existing Income Tax Act of 1961. None of them has officially been made public yet, but media reports point to a relief in tax rates for individual taxpayers, simpler assessment procedures and a lower corporate tax rate even for large companies, among other changes, such as fewer exemptions and the use of Artificial Intelligence to curb tax evasion. A proposed replacement of “assessing officers" with “assessment units", as reported, has attracted special attention. So has a new mediation process to settle tax disputes. Together, these could reduce the harassment of taxpayers. But from the perspective of India’s economy, what might turn out to be the most effective is the rationalization of corporate taxation.