Calcutta, Aug. 24: The Direct Taxes Code, which is set to replace the Income Tax Act of 1961, is likely to take more time before being re-introduced before the cabinet.
Parthasarathi Shome, adviser to finance minister P. Chidambaram, today said various proposals of the draft DTC bill prepared by the finance ministry was being reviewed by different ministries.
“A draft has been made by the ministry of finance. Now it is being looked into by other ministries as is the custom,” Shome said on the sidelines of a conference on taxation organised by industry body Assocham.
The DTC bill was scheduled to be brought before the cabinet on August 22. However, it was deferred. The bill, which aims to rationalise tax rates to bring more people and companies under the tax net, was introduced in Parliament in 2010.
In the revised draft bill, the finance ministry proposed a new tax slab for individuals with income of over Rs 10 crore.
Replying to a query on the cabinet’s decision to defer the discussion on the bill, Shome said, “My understanding is that it was felt the ministries should be given the required time.”
When asked whether the ministry is considering a decision to re-look into the proposal of imposing an additional tax slab, Shome replied, “Everything will be looked into.”
“DTC has many different elements, it has corporate tax and various complexities of controlling foreign companies…they will be rightfully looked into,” he added.
He said the newly-constituted tax reforms committee was emphasising on dissolving some of the tax-related “hitches” in its meetings with the representatives of various corporate houses of the country.
The finance ministry decided to constitute the commission to review tax policies and tax laws to dispel fears of investors.