Latest Expert Exchange Queries

Make your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: form 3cd :: VAT RATES :: cpt :: articles on VAT and GST in India :: ARTICLES ON INPUT TAX CREDIT IN VAT :: empanelment :: TDS :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: ACCOUNTING STANDARDS :: VAT Audit :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ACCOUNTING STANDARD :: due date for vat payment :: Central Excise rule to resale the machines to a new company
 
 
Direct Tax »
 CBDT: GST not to be added for TDS computation
 Five interest incomes you are likely to forget to include in your tax return
 GST not to be added for TDS computation
 GST not to be added for TDS computation
 Income Tax Return (ITR) Filing: Common Mistakes That Could Get You A Tax Notice
 Income Tax department asks tax practitioners to register entities separately
 Last Date To File Income Tax Return. Here Are The Details
 New tax regime will deliver a mixed bag with some items turning costly
 New members at CBEC, CBDT
 CBDT signs 5 more unilateral advance pricing agreements with taxpayers
 Find out potential taxpayers; focus on smaller cities: CBDT to taxmen

Taxmen feel that Direct Tax Code may lead to loss
September, 21st 2009

Critical of the proposed Direct Tax Code (DTC), senior Income Tax officials feared that it may result in an annual revenue loss of Rs 55,000-crore and that it was not revenue-neutral as made out to be.

"The tax revenue loss could be as high as around Rs 55,000-crore annually with estimated revenue loss in personal Income Tax (PIT) alone standing at around Rs 25,000-crore," senior Income Tax Officials including chief commissioner level officers told.

The officers, mostly based in Mumbai, wanted to remain anonymous, being serving Government officials.

Noting that the new tax code is heavily skewed against the salaried class, they said it attempts to reversed the concept of "pay-as-you-go (earn)" considered to be the rational tax policy all over the world.

Under the garb of providing long-term stability in the tax regime, the tax code in fact would widen the rich-poor gap and create more economic absurdities, the officials which included some commissioners as well, said.

"Take the case of individuals where extensive give-aways by widening the tax base took place. The DTC plans to recover them by taxing pensions, leave encashment, retrenchment, compensation, commuted pensions, VRS compensation, gratuity received on death and drawings from superannuation fund," officials said.

Besides, DTC also plans to recover these give-aways by taxing non-monetary benefits such as LTC, medical reimsbursements, house perquisites, etc, they say.

The direct tax code sought to remove the power of the Central board of direct taxes to issue notification and circulars or to bring amendments, they said, adding those who have drafted it have displayed "a sinister ulterior motive" rarely witnessed in mature democracies.

Also, the press reports that the CBDT has been kept away from this process of preparing the tax code itself showed the "perversity" of the authors.

"Such ill-baked work should not be thrust upon the unsuspecting public," they said.

The new source of tax revenue heavily relied on retirement benefits, termination and gratuity, whereas the other new revenue sources like LTC, medical reimbursements were periodical in nature, they said.

"In other words, new tax sources affect only those minor portion of the vast employee tax base like retirees, persons who availed LTC, medical benefits, etc., whereas the give-aways are to the entire tax-payer population," officials say.

"Taking into account all these factors, it is no brainer to see that we are heading for a steep fall in revenue in FY 11-12, when the proposed DTC comes into effect," the officials said.

With an estimated tax loss of Rs 55,000-crore, the DTC is a disaster and that is precisely the reason why no estimates of the tax losses are provided in the Code, the officials said.

"As per the economic survey 2009, 60 per cent of India's population do not have income of (even) Rs 20 per day. In such a grave situation with about 660-million mouths to feed, why should the Government forego Rs 1.2-lakh as tax from a person earning Rs 10-lakh income," the officials said.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Quality Assurance Services Testing and Re-testing

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions