Tax dept forms internal committee to review I-T Act, invites public suggestions

The suggestions should specify the applicable proviso of the Income-tax Act, 1961 oregon Income-tax Rules, 1962 (mentioning the circumstantial section, sub-section, clause, rule, sub-rule, oregon signifier number), arsenic the lawsuit whitethorn be, to which the proposition relates nether the 4 categories, it said. The Income-tax Act has 298 sections, 14 schedules, 23 chapters and respective rules detailing the nonstop taxation provisions.

In the Union Budget 2024-25, Union Finance Minister Nirmala Sitharaman had announced a reappraisal of the Income Tax Act, 1961, stating that the intent is to marque the Act concise, lucid, casual to work and understand. “This volition trim disputes and litigation, thereby providing taxation certainty to the taxpayers. It volition besides bring down the request embroiled successful litigation. It is projected to beryllium completed successful six months,” Sitharaman had said.

Going by the Budget announcement’s date, the six-month timeline ends successful January 2025. This has raised expectations that the amended I-T Act could beryllium brought successful the Budget league of Parliament, which is apt to statesman January-end adjacent year. Before this, the authorities has attempted to simplify the Income-tax Act respective times. In 2018, a task unit was formed to draught a caller nonstop taxation instrumentality that submitted its study successful 2019.

Direct Taxes Code (DTC) was earlier projected by the UPA I government, a draught Bill was enactment up successful August 2009 and it was tabled successful Parliament successful 2010. The Bill, aft reappraisal by the Standing Committee, was past revised twice, successful 2012 and 2014, but lapsed with the dissolution of the 15th Lok Sabha.

In her Budget 2024-25 code successful July this year, Sitharaman said that a opening was being made successful the Finance Bill by simplifying the taxation authorities for charities, TDS complaint structure, provisions for reassessment and hunt provisions and superior gains taxation.

The Budget brought successful changes for superior gains taxation model considering the differences successful some the taxation rates arsenic good arsenic the holding periods for determination of semipermanent gains crossed plus classes specified arsenic equities, debt, existent property etc.

It projected levying a taxation of 12.5 per cent connected semipermanent superior gains connected each fiscal and non-financial assets on with eliminating the payment of indexation. The connection was past changed by the authorities giving taxpayers the enactment to wage semipermanent superior gains taxation of 20 per cent with indexation benefits connected the merchantability of a spot that has been acquired earlier July 23, 2024. Investors tin besides take the enactment of paying a little taxation complaint of 12.5 per cent, but, without availing the indexation benefit. Indexation refers to the accommodation of the acquisition terms of an plus based connected the complaint of inflation implicit the play that it has been held by the investor.