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The Direct Taxes Code (DTC) Bill, which aims to overhaul the over 50-year-old Income Tax Act, is almost ready and will be taken up in the Monsoon session of Parliament, Finance Minister P Chidambaram said here on Friday.
“I am just writing the code. We will introduce it in the Monsoon session. We have another week’s work on that,” he said.
The finance minister was here to attend the Silver Jubilee celebrations of the Securities and Exchange Board of India (Sebi). The DTC Bill was introduced in Parliament in 2010 and was referred to the standing committee on finance, headed by Bhartiya Janata Party leader Yashwant Sinha.
Among other things, the committee had suggested raising the income tax exemption limit to Rs 3 lakh as against Rs 2 lakh proposed in the original DTC Bill. On corporate tax, it recommended the rate be retained at 30 per cent. The Income Tax Act was enacted in 1961.
Responding to a suggestion on the need for simple tax laws, Chidambaram said: “I don’t know what a simple tax code is. The point was a tax code cannot be written in five pages. A tax code will run into few hundred pages...I don't think you can write a simple tax code.” He said India’s Income Tax Act or all the pages related to direct taxes is only a fraction when compared to the number of pages in the United States.
Referring to his recent meeting with Organisation for Economic Co-operation and Development members, he said the member-countries had asked a team to work on ‘base erosion and profit sharing’.
