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Government mulls more debate over tax reforms
January, 19th 2010

The government will hold more discussions to get inputs for introducing major tax reforms like Direct Taxes Code (DTC) and Goods and Service Tax (GST), Finance Minister Pranab Mukherjee indicated on Monday. 

More discussions are needed to evolve consensus on introducing such major tax reforms, he said while addressing the meeting of parliamentary consultative committee attached to the finance ministry.

The government proposes to introduce DTC with effect from April One, 2011 replacing the archaic Income Tax Act, 1962.

But in the face of sharp reactions on some of the major tax proposals as suggested in the DTC like taxing of popular saving schemes like Public Provident Fund, Employees Provident Fund and General Provident Fund, the government is understood to be adopting an approach of consensus for putting in place the new tax regime in the sensitive Direct Tax front.

Similarly, the government is facing an arduous task of evolving a consensus on implementation of the GST, which is scheduled to be implemented with effect from April 1 this year.

The GST seeking to replace Central Excise and Services Tax at the central level and Value Added Tax (VAT) and Octroi at state  level.

However, there appears to be divergence of views even among states over various aspects relating to GST thus casting doubt whether the new tax regime in the Indirect Tax front can be implemented from the scheduled date of April 1 this year.

 
 
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