Income tax laws set for makeover; check top 5 key takeaways

FM Arun Jaitley says the govt is all set to simplify the income tax laws in India to help the common man and ensure a better ease of doing business regimen. Jaitley said, “We have over the last few months been resolving a lot of past issues and now time has come to look at some provisions of the Income Tax Act to look at how their drafting quality can be improved.” Here are top 5 key takeaways
from his statement on how the govt is going about solving the income tax conundrum:
1. The government set up a 10-member committee, chaired by former Delhi High Court judge R V Easwar, to identify provisions in the Income Tax Act that “lead to litigation and impact the ease of doing business”.
2. The new committee with one-year term has experts from both the government and private sectors and would be contributing regularly towards legislative changes in direct tax law. It will suggest steps to simplify the law in light of existing jurisprudence and suggest alternatives to existing provisions to bring predictability and certainty without affecting tax base and revenue.
3. The disputes arising from the 2012 retrospective amendment to the Income Tax Act aimed at taxing past cases of offshore transactions involving Indian assets are not explicitly referred to the committee – companies like Cairn, Vodafone and Sanofi Aventis are facing tax demands in India.
4. The revenue department has asked the panel to submit the first of its reports incorporating as many recommendations as possible by January 31 so as to accommodate them in the next Budget.
5. Besides the chairman, the panel includes former law secretary VK Bhasin, revenue officers Arvind Modi and Vinay Kumar Singh, Vinod Jain, Rajiv Memani, Rajiv Gupta, Mukesh Patel, Ajay Bahl and Pradip Shah as members.