Indians could get richer by saving more on income tax and enjoy other benefits if the Direct Taxes Code proposed by the Union Government becomes a law, according to the Bangalore Chambers of Industry and Commerce (BCIC).
According to the draft DTC on income tax, the slab of income would be raised in ways beneficial to all citizens of the country.
The Act which is to be implemented by April 1, 2009, has suggested that the tax bracket for earning individuals be raised and only people earning more than Rs 25 lakh or more per annum would be liable to pay 30 per cent which was earlier only Rs 5 lakh. Earnings up to Rs 10 lakh would be charged only 10 per cent tax under the proposed revision.
The BCIC released an overview and recommendations book on Tuesday on the Direct Taxes Code and the rationale behind their proposals.
The forum has conducted extensive research and analysis and with the help of experts from various organisations, and has come up with a comprehensive document, said KR Girish, President of BCIC. He also said that taxes were progressive and would encourage spending power and leave common man with more disposable income.
The Income Tax Act of 1961 is being reviewed with the Prime Minister Manmohan Singhs inclusive growth philosophy, he said.
Even the corporate tax has been reduced to 25 per cent from 30 per cent but the exemptions have been removed and taxes would not be charged under MAT and book profits and will be taxed for gross assets.