The Union Ministry of Finance set up a task force to redraft the Income Tax law. Arbind Modi, the first convenor of the panel, retired on September 30. He was succeeded by Akhilesh Ranjan.
Akhilesh Ranjan cleared all air task force role in possible dramatic policy changes. Changes in income tax rates are also highly unlikely. He said that the task force was focused on removing ambiguities and not primarily focused on policy changes. He also promised a more comprehensible Tax Law System post the redraft of the IT Act of 1961. Reportedly, the ACT has had a host of provisions, clauses, and explanations added to its original draft.
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Ranjan, who is also a member legislation in the Central Board of Direct Taxes (CBDT), said, “The focus is not on coming out with a new tax policy but the focus is on making the law more comprehensible”.
This is however not the first time when a call for changes in the IT ACT has gained strength:
UPA Government in 2009 had proposed DTC or Direct Tax Code in replace of the cumbersome the IT law. The current NDA Government has already put into effect the GAAR (general anti-avoidance rules ) ACT.
Other members of the 6 member panel of the Taskforce include Rajiv Memani (Chairman and Regional Managing Partner of EY), Girish Ahuja (chartered accountant), Mukesh Patel (practicing tax advocate), G C Srivastava (retired IRS and advocate), and Mansi Kedia (Consultant, ICRIER)
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Reportedly, the current Income Tax Law exempts individuals with annual income up to Rs 2.5 lakh from Income Tax. Also, Corporate Sector would be hoping that apt steps would be taken in the new draft to lower corporate tax to 25 percent in 5 years. However, the draft is unlikely to meet the floor of the House before the interim budget on February 1.
