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Eco survey suggests Income Tax Code
July, 03rd 2009

New simplified law should be put in place to replace the over four-decade old Income Tax Act and streamline the direct taxation structure, the Economic Survey said today. 

"Introduction of the new Income Tax Code, that results in a neutral corporate tax regime (is needed)," the Economic Survey for 2008-09 tabled in Parliament said.    

The much-talked about Income Tax Code is expected to reduce the plethora of exemptions given to various segments of taxpayers.    

Income tax code would replace the existing Income Tax Act, which was enacted in 1961, and would subsume other direct tax legislations.    

The new tax code is also expected to come out with taxation structure where exemptions are few.    

Talking about the proposed tax code, former Finance Minister P Chidambaram had said the marginal rate of taxation, including education cess stood at 33.99 per cent.   

"My endeavour has been to increase the effective rate of corporate tax paid by corporations, but I confess my efforts are not entirely successful because of demands for continuing exemptions or introducing new exemptions," Chidambaram had said.

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