The National Democratic Alliance (NDA) government, in its second term, plans to introduce transformational changes in the direct tax regime by pruning a tax rate that is as high as 30%, widening the tax base and making it easier for honest individuals and corporate entities to comply with tax laws.
At the same time, wilful tax evaders and money launderers will not be spared, government officials aware of the plan said.
In its first term, the NDA government, led by Narendra Modi, introduced the Goods and Services Tax (GST) on July 1, 2017, to revamp the direct tax regime. Although it was criticised for its shoddy implementation at the start, GST subsumed a range of national, state- and local-level taxes and ushered in a uniform tax regime in the country.
Now, the finance ministry has been asked to speed up the framing of the Direct Tax Code (DTC) and incentivise individuals and companies to voluntarily file their tax returns, as the government seeks to widen the direct tax base, two officials with direct knowledge of the matter said on condition of anonymity.
‘We are expecting the task force [on DTC] to definitely submit its report by July 31,’ one of the officials said, adding that the task force was ‘reviewing existing income-tax laws and drafting a new direct tax law in consonance with economic needs of the country’.
Post Your Comments