Direct Tax Code to roll by next year, says Pranab Mukherjee
April, 02nd 2012
Union Finance Minister Pranab Mukherjee on Saturday said that the long-awaited Direct Tax Code (DTC) would be rolled out from next year.
"Next year, I will introduce the DTC fully after examining the recommendations of the parliamentary standing committee. The recommendations of the parliamentary standing committee were available to me on March 9," said Mukherjee at a seminar here.
The finance minister further said the government would be forced to cut subsidies and added that they would not cut subsidies in food.
"Certain subsidies in our system are inevitable like food. Yes, we should provide food subsidies but at the same time, in the other areas, we shall have to peg it and link it to the capacity and capability of paying. And that (subsidies) must be reduced," added Mukherjee.
Mukherjee added that use of modern technology should be promoted to reach out to targeted poor.
"Along with that we shall ensure that we can reach the targeted beneficiary by taking advantage of the new technology, through 'Adhar' (scheme) platform so that important commodities like kerosene, fertilizer and LPG could be reached to the targeted beneficiary," added Mukherjee.
The DTC will replace the Income Tax Act is expected to bring about changes in personal and corporate taxation.
It intends to cut tax rates to bring more people and companies under the tax net, phase out profit-linked exemptions for companies and replace them with investment-linked incentives.
In his budget speech, Mukherjee said that the government planned to cut oil and fertiliser subsidies to the point where total subsidy costs do not exceed 2 percent of Gross Domestic Product (GDP) in the coming fiscal year - down from 2.4 percent in 2011-12 and fall further subsequently.