In order to replace the existing Income Tax Act, 1961, the government is aiming to come out with a new Direct Tax Code. A task force entrusted with the preparation of the tax code was to submit its report to the Finance Ministry on Wednesday.
The task force, led by Central Board of Direct Taxes (CBDT) member Akhilesh Ranjan, was also assigned to incorporate in the tax code provisions for reducing litigation and the time taken for deciding on appeals by the income tax department’s officials and the various courts, including high courts and the Supreme Court.
The new Direct Tax Code will try to make personal income tax rates more ‘progressive’ by giving relief to the people in the 5 per cent and 20 per cent slabs. It is also aimed at reforming the complex income tax laws into simpler tax codes with reduced rates, fewer exemptions and tax slabs.