<p>Income tax rates for individual tax payers will be much lower, surcharges on income will be a thing of the past and companies will not have to pay taxes on the dividends they earn, if the Centre accepts the recommendations of a task force on Direct Taxes Code (DTC) that submitted its report on Monday after nearly two years of churning.</p>.<p>The report, after incorporating international best practices on individual and corporate income tax, has suggested several changes in the current income tax structure with a view to making taxation simple and more predictable for individuals, companies and the government.</p>.<p>The content of the report, spread over two volumes, is not yet known but sources said it ranges from lowering tax rates, simplifying slabs and making tax filing easier than before to suggesting ways to reduce tax litigation. The committee has argued against any surcharge on income and has suggested that even if it is levied it should be temporary in nature.</p>.<p>“The future roadmap for individual and corporate taxation is far-reaching. If the Centre implements the suggestions, paying income tax will not be too burdensome for citizens,” sources privy to the recommendations told <em><span class="italic">DH</span></em>.</p>.<p>Various governments in the past have been taking recourse to surcharges on incomes of individuals or companies to shore up revenues.</p>.<p>Currently, there are four income tax slabs in India and the tax rate varies from 5% to 30%. In addition, a surcharge of 15% is levied on individuals earning over Rs 1 crore, and 10% on income of individuals between Rs 50 lakh and Rs 1 crore.</p>.<p>In the Budget for 2019-20, Finance Minister Nirmala Sitharaman proposed to enhance the rate of surcharge to 25% for individuals earning between Rs 2 crore and Rs 5 crore and 37% for those earning over Rs 5 crore. The decision has irked India’s super rich.</p>.<p>The DTC is likely to come into force from the financial year 2020-21 and will replace the Income Tax Act of 1961. The panel has also suggested sharing of information between GST, CBDT and Customs. </p>.<p>The committee, headed by Central Board of Direct Taxes (CBDT) member Akhilesh Ranjan, has submitted the report to the finance minister. It will be uploaded on the ministry’s website for public consultation after the government takes a look at it.</p>.<p>Shortly before the submission of the report, Nirmala Sitharaman said the government would support wealth creators and that corporate tax rate for all companies would gradually come down.</p>.<p>Prime Minister Narendra Modi had, in his Independence Day speech, said that wealth creators were the wealth of the nation and they deserved respect.</p>
<p>Income tax rates for individual tax payers will be much lower, surcharges on income will be a thing of the past and companies will not have to pay taxes on the dividends they earn, if the Centre accepts the recommendations of a task force on Direct Taxes Code (DTC) that submitted its report on Monday after nearly two years of churning.</p>.<p>The report, after incorporating international best practices on individual and corporate income tax, has suggested several changes in the current income tax structure with a view to making taxation simple and more predictable for individuals, companies and the government.</p>.<p>The content of the report, spread over two volumes, is not yet known but sources said it ranges from lowering tax rates, simplifying slabs and making tax filing easier than before to suggesting ways to reduce tax litigation. The committee has argued against any surcharge on income and has suggested that even if it is levied it should be temporary in nature.</p>.<p>“The future roadmap for individual and corporate taxation is far-reaching. If the Centre implements the suggestions, paying income tax will not be too burdensome for citizens,” sources privy to the recommendations told <em><span class="italic">DH</span></em>.</p>.<p>Various governments in the past have been taking recourse to surcharges on incomes of individuals or companies to shore up revenues.</p>.<p>Currently, there are four income tax slabs in India and the tax rate varies from 5% to 30%. In addition, a surcharge of 15% is levied on individuals earning over Rs 1 crore, and 10% on income of individuals between Rs 50 lakh and Rs 1 crore.</p>.<p>In the Budget for 2019-20, Finance Minister Nirmala Sitharaman proposed to enhance the rate of surcharge to 25% for individuals earning between Rs 2 crore and Rs 5 crore and 37% for those earning over Rs 5 crore. The decision has irked India’s super rich.</p>.<p>The DTC is likely to come into force from the financial year 2020-21 and will replace the Income Tax Act of 1961. The panel has also suggested sharing of information between GST, CBDT and Customs. </p>.<p>The committee, headed by Central Board of Direct Taxes (CBDT) member Akhilesh Ranjan, has submitted the report to the finance minister. It will be uploaded on the ministry’s website for public consultation after the government takes a look at it.</p>.<p>Shortly before the submission of the report, Nirmala Sitharaman said the government would support wealth creators and that corporate tax rate for all companies would gradually come down.</p>.<p>Prime Minister Narendra Modi had, in his Independence Day speech, said that wealth creators were the wealth of the nation and they deserved respect.</p>
