The Government appointed task force on direct taxes submitted its recommendations to Finance Minister Nirmala Sitharaman on Monday.
The recommendations have not been made public as of now but according to an exclusive newsbreak from taxsutra.com’s Arun Giri
, there are a host of proposed changes.
According to sources, the tax force has batted for a big tax relief for the middle class and individuals earning up to Rs 50 lakh per annum.
The panel had 89 meetings over a period of 21 months before finalising its recommendations on overhauling India's direct tax regime as well as a draft legislation.
The panel has proposed a 25 percent corporate tax rate for both domestic & foreign companies and a levy of branch profits tax on foreign companies. The task force has also recommended eliminating Dividend Distribution Tax and said that the onus of payment should be on the dividend recipient.
The task force has also recommended sea changes in the assessment process. The first is that “assessment units” and not 'assessing officers' should conduct assessments. Also, “functional units' will need to be established based on IRS officers’ sectoral specialisation.
Furthermore, the task force has recommended a 'mediation' option for taxpayers to negotiate settlement on tax disputes. It has also suggested setting up a litigation management unit to manage the entire tax litigation process. The task force has also proposed a “public ruling' option to let taxpayers approach the Central Board of Direct Taxes (CBDT) for clarifications.
It is noteworthy that the Modi government in 2017 had decided to junk the proposed Direct Taxes Code of 2013 and have its own panel deliberate on reforming the income tax regime and re-calibrate tax slabs.