Direct Taxes Code Delayed to 2012
Aug. 31 – The Indian government has decided to delay the implementation of the Direct Taxes Code (DTC) from April 1, 2011 to April 1, 2012 as part of efforts to improve preparations for the major change.
“The issue that the operation has been put on hold for a year is to allow all three categories [tax practitioner, taxpayer, and tax administrator] enough time to become adequately familiar with the new provisions in the DTC,” Revenue Secretary Sunil Mitra said in a statement.
Authorities are working towards lifting the income tax exemption limit from Rs.160,000 to Rs.200,000 in addition to maintaining tax incentives for individuals.
The new code calls for citizens aged 65 years old and above to be qualified for a higher tax exemption rate of Rs.250,000. Corporate taxes will be pegged with a 30 percent tax while the minimum alternate tax will based on 20 percent of book profits.
It will also lead to gross tax revenue from direct taxes falling significantly and replace the more than five decade Income Tax Act.
The details of the new DTC has been subject to intense debate among authorities since its first draft was released in 2009. This is the second time that the DTC has been deferred to a later date.
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