Government Forms Panel to Simplify Income Tax Act Provisions
Government Forms Panel to Simplify Income Tax Act Provisions – Finance Minister Arun Jaitley said the main idea behind setting up the panel is to make the I-T Act more simpler. “So, as and when it keeps giving one bundle of suggestion with regard to simplification we will examine them and whichever are found acceptable we will try and simplify those provisions of the I-T Act,” he said.
To simplify income tax laws, the government today set up a committee under a former Delhi high court judge to identify clauses that lead to litigations and suggest modifications to bring predictability and certainty in tax laws.
The 10-member panel, to be headed by Justice RV Easwar, (Retd), has been asked to submit a preliminary report by January 31, so as to help incorporate some of them in the Budget for 2016-17.
The committee has been asked “to study and identify the provisions/phrases in the (income tax) Act which are leading to litigation due to different interpretations.”
Finance Minister Arun Jaitley said the main idea behind setting up the panel is to make the I-T Act more simpler.
“We have over the last few months been resolving a lot of past issues and now time has come to look at some provisions of the I-T Act to look at how their drafting quality can be improved in order to avoid ambiguity so that everybody is certain as to what the Act itself says,” he told reporters.
Also, the panel will study and identify the provisions which are impacting the ease of doing business as well as identify the areas and provisions of the Act for simplification in the light of the existing jurisprudence.
The terms of reference of the committee also include to give suggestions on “alternatives and modifications to the existing provisions and areas so identified to bring about predictability and certainty in tax laws without substantial impact on the tax base and revenue collection.”
“We have constituted a committee to simplify the provisions of the I-T Act. The committee would be headed by Justice Eshwar who was the chairman of ITAT and judge of the High Court in Delhi.
“It has several expert both from government and private sector in it and this committee will be doing an ongoing study from time to time.
“So, as and when it keeps giving one bundle of suggestion with regard to simplification we will examine them and whichever are found acceptable we will try and simplify those provisions of the I-T Act,” he said.
The BJP-led government had previously used recommendations of a three-member panel headed by former Delhi High Court judge A P Shah to waive retrospective levy of Minimum Alternative Tax (MAT) on FIIs and foreign portfolio investors.
“The Eshwara committee can form three sub-groups. The sections of I-T Act which are posing maximum litigations due to wrong drafting would be worked upon by the committee,” Revenue Secretary Hasmukh Adhia said.
He said public comments will be invited on recommendations of the committee. “As and when the committee submits report the I-T Act would be amended.”
The panel, which will have a term of one year, will set its own procedures for regulating its work.
“The Committee can also work in Sub-Groups and the draft prepared by the Sub-Groups can then be approved by the whole Committee. The Committee will put its draft recommendations in the public domain.
“After stakeholder consultations, the Committee will formalise its recommendations. The Committee can give its recommendations in batches. The first batch containing as many recommendations as possible shall be submitted by January 31,” an official statement said.
The committee comprises of V K Bhasin, former Law Secretary; Vinod Jain, Chartered Accountant; Rajiv Memani, Consultant; Ravi Gupta, Senior Advocate; Mukesh Patel, Tax Advocate; Ajay Bahl, Consultant; Pradip P Shah, Investment Adviser; Arvind Modi, IRS; Vinay Kumar Singh, IRS.
Source: Economic Times