The federal government will introduce a brand new revenue tax invoice within the upcoming Parliament finances in a significant transfer to simplify India’s tax system, it was quoted as saying by information company PTI. The proposed laws goals to switch the six-decade-old Earnings Tax Act, 1961, with a concise, lucid, and understandable model, lowering the variety of provisions by about 60 per cent.
Finance Minister Nirmala Sitharaman had introduced a complete overview of the Earnings Tax Act in her July 2024 finances speech and promised to revamp the regulation in six months. Sources mentioned the draft regulation is presently being reviewed by the Ministry of Legislation and is anticipated to be tabled in Parliament through the second half of the finances session.
Key particulars of the Price range Session
The Price range session will start on January 31, 2025, and finish on January 4, 2025. The joint session of Parliament will start with an tackle by President Draupadi Murmu, adopted by the presentation of the Financial Survey for 2024-25. The Union Price range for 2025-26 can be offered on February 1, 2025.
Objectives of the brand new Earnings Tax Invoice
The brand new regulation requires:
- Simplify the language and provisions of the present Earnings Tax Act.
- Cut back litigation and disputes by growing readability and acceptance by taxpayers.
- Elimination of out of date provisions and modernisation of tax administration.
- Cut back the variety of chapters and elements to simplify compliance.
Evaluation course of and public enter
To attain these objectives, the Central Board of Direct Taxes (CBDT) had fashioned an inner committee and 22 specialised sub-committees to overview varied features of the Act. The Earnings Tax Division acquired over 6,500 solutions from stakeholders, specializing in language simplification, compliance discount, litigation minimisation, and eradicating redundant provisions.
The prevailing Earnings Tax Act, 1961, incorporates 298 sections throughout 23 chapters and addresses varied direct taxes, together with private revenue tax, company tax, and securities transaction tax. The brand new draft goals to scale back the Act’s measurement by roughly 60 per cent.
Anticipated affect
As soon as applied, the brand new regulation will make tax compliance simpler, scale back administrative burden, and foster a extra taxpayer-friendly surroundings. Finance Minister Sitharaman acknowledged that the revised regulation would decrease disputes, expedite decision, and supply much-needed tax certainty for people and companies.
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