New Delhi, Aug 19 (IANS) The Task Force to rewrite the decades-old Income Tax Act, 1961 has submitted its report to Finance Minister Nirmarala Sitharaman, sparking hopes of a simpler tax law with an easier compliance burden and friendly tax administration.
Panel convenor Akhilesh Ranjan, member of apex tax policy-making body Central Board of Direct Taxes (CBDT), submitted the report after missing two deadlines.
But the government has not made the report public with official sources saying that it would first study it before putting it in public domain for feedback.
It has been learnt that the report contains two parts with one being the draft bill while the other comprised recommendations considering best practices in the world.
The terms of reference of the DTC panel was in June this year expanded to include faceless and anonymised scrutiny assessments, reduction of litigation and expeditious disposal of appeals, sharing of information with GST and customs, simplification of compliance and system-based cross-verification of financial transactions.
Sharing his expectations, Sandeep Jhunjhunwala, Director, Nangia Advisors said that implementation of few aspects as per the terms of reference of the DTC panel were already activated by the government.
He said that simplification of compliance by the proposed move would bring pre-filled income tax returns, faceless and anonymised scrutiny assessment among others.
"On income tax litigation reforms, it is likely that amnesty schemes akin to ''Sabka Vishwas'' (Legacy Dispute Resolution) Scheme that was introduced to curb pending litigations under the erstwhile indirect tax enactments, could be announced on the direct tax front as well. India Inc waits to see the bold reforms that would manifest in the new foundation of direct taxes," Jhunjhunwala said.
Tax experts hope the new draft law would ease compliance burden and reduce future litigation by incorporating orders of various High Courts and the Supreme Court while settling cases.
"The biggest thing one can expect that the settled positions which have come through courts are incorporated so that there are fewer litigations in the future," said Riaz Thingna, director, Grant Thornton Advisory Pvt Ltd.
A tax advisor associated with one of the Big-4 consultancies, however, said that the new draft law would unlikely incorporate all the court orders.
"It will only include those where tax department has got favourable orders," he said.
The report of the Task Force has come at a time when the economy is going downhill with most macro indicators pointing to a slowdown. Various sectors such as automobile and real estate are going through one of the worst crisis in recent years with demand for relief package growing by the day.
Rahul Garg, Senior Partner (Tax & Regulatory), PwC India, said that his expectation is that the new DTC would be a modern law which would make tax administration technology enabled. Further, it would make tax governance effective.
Amrish Shah, Partner, Deloitte India hopes lower tax regime once the new direct tax code and recommendations are implemented.
"Reducing corporate tax rate to 15 per cent -- if implemented, this will make India possibly the most attractive investment destination in the world. Corporate tax rate should also be uniform across companies irrespective of their size," he said.
Disclaimer :- This story has not been edited by Outlook staff and is auto-generated from news agency feeds. Source: IANS