Experts attending an interactive session here over the weekend on the Union Government’s proposed new Direct Tax Code expressed hope that it would make tax laws simpler by streamlining various complex provisions and reduce the scope for litigation while fostering voluntary compliance.
They felt that the proposed model would produce an “equitable and inclusive” long-term savings environment.
The interactive session with the Revenue Secretary in the Union Ministry of Finance, P. V. Bhide, was organised by the Rajasthan State Council of the Confederation of Indian Industry (CII) with a view to ensuring a greater clarity on the proposed tax regime.
Addressing the gathering, Mr. Bhide said the Bill, to be introduced in the winter session of Parliament later this month, would mark a new era in functional democracy and encourage investments with the reduced 25 per cent rate of corporate tax. A change in the mind-set of people would be required to accept the new system, he added.
“The Union Government has looked at its international obligations with all seriousness and dealt with the task of bringing the tax rate down in the new code after inviting suggestions and viewpoints from the industry,” said Mr. Bhide, adding that the Direct Tax Code would be finalised after consideration of all public suggestions received.
The Revenue Secretary said the code was being introduced to have the common people understand the tax structure better and allow them more disposable income in their hands. “This Act will also do away with the multiple number of exemptions, enabling the taxman with more time for developmental activities,” he remarked.
Confederation of Indian Industry State Council chairman Kishore Khaitan said the new code would overhaul the direct tax legislation in the country and would have a significant impact on business. He pointed out that the existing direct tax law was “onerous and complex” and added that the Union Government had put in efforts for three years to bring out the new code.
Sanjay Jhanwar, member of the CII State Council’s Economic Affairs Panel, made a presentation on the salient features of the Direct Tax Code. He said the code would have a far-reaching impact on businesses and in many cases the business models themselves would require a fresh look.
Many of the speakers pointed out that the new tax code would simplify the tax structure, make it more efficient in the long term and integrate with the global best practices.
Arbind Modi, Joint Secretary in the Union Finance Ministry, and C. S. Kahlon, Member of the Central Board of Direct Taxes, replied to various queries from captains of industry, entrepreneurs, tax consultants and government officials.
CII State Council past president Rajiv Jain said the industry body was optimistic that the new code would bring about a lot of positive reforms in the tax structure and reiterated the CII’s commitment to support and assist the Union Government in taking forward the reform agenda.