Union Cabinet Approves New Income Tax Bill: Aimed at Simplifying Direct Tax Laws and Making Them More Accessible
In a significant move, the Union Cabinet has approved the new Income Tax Bill, which is expected to be introduced in the Parliament in the coming week. The proposed Bill aims to simplify direct tax laws and make them more accessible to taxpayers. The government also intends to reduce the length of the over six-decade-old Income Tax Act through the new Bill.
The Income Tax Act, 1961, has been a subject of criticism for its complexity and ambiguity, leading to confusion and disputes among taxpayers. The new Bill is expected to address these issues and provide a more taxpayer-friendly framework.
According to the report by PTI, the new Income Tax Bill is aimed at reducing the tax burden on individuals and businesses, while also increasing the tax base. The government has identified several areas that need simplification, including tax rates, tax deductions, and tax exemptions.
One of the key features of the new Bill is the introduction of a simpler tax structure. The government is planning to reduce the number of tax slabs and simplify the tax rates. This is expected to reduce the complexity of tax calculations and make it easier for taxpayers to determine their tax liability.
The Bill also proposes to increase the tax exemption limit for individuals. Currently, the tax exemption limit for individuals is Rs 2.5 lakh per annum, which is expected to increase to Rs 3 lakh or more. This will provide a higher exemption limit for taxpayers, which will reduce their tax liability.
Another significant change proposed in the new Bill is the introduction of a new tax regime for individuals. The government is planning to introduce a new tax regime, which will provide a lower tax rate for individuals who opt for it. This regime will offer a reduced tax rate of 10% to 25%, which is lower than the current tax rates.
The new Bill also proposes to simplify the tax compliance process. The government is planning to introduce a new self-certification system, which will allow taxpayers to certify their income and tax deductions without the need for third-party verification.
The Bill also aims to reduce the tax disputes by providing a more transparent and predictable tax regime. The government is planning to introduce a new dispute resolution mechanism, which will provide a faster and more efficient way of resolving tax disputes.
The new Income Tax Bill is expected to benefit taxpayers in several ways. It will simplify the tax compliance process, reduce the tax burden, and provide a more transparent and predictable tax regime. The Bill is also expected to increase the tax base, which will provide a boost to the government’s revenue.
The introduction of the new Income Tax Bill is a significant step towards simplifying the direct tax laws in India. The government’s efforts to simplify the tax laws and make them more accessible to taxpayers are expected to benefit the economy and promote tax compliance.
In conclusion, the Union Cabinet’s approval of the new Income Tax Bill is a significant development in the Indian tax landscape. The proposed Bill aims to simplify direct tax laws, reduce the tax burden, and provide a more transparent and predictable tax regime. The government’s efforts to simplify the tax laws and make them more accessible to taxpayers are expected to benefit the economy and promote tax compliance.
