Providing relief to salaried employees, the finance ministry will review the provisions in the Direct Taxes on taxation of salaried individuals as well as taxation of income from house property in case of self-occupied property (SOP) by the individual. This was announced by finance minister Pranab Mukherjee in the meeting of the Parliamentary Consultative Committee on Finance.

“The outcome of the discussion would be used for modifying the proposals contained in the draft Direct Taxes Code,” he assured the parliamentary committee. But even while Mukherjee has promised that the Code would be finalised only after comprehensive discussions with all stakeholders, North Block seems keen to push it into Parliament soon. In fact, it intends to introduce the Direct Taxes Code Bill in Parliament in a month’s time — by the last week of the winter session.

“Government has identified nine critical areas for further detailed examination. These relate to the concept of minimum alternative tax; capital gains taxation in the case of non-residents; the Double Taxation Avoidance Agreement; General Anti-Avoidance Rule (GAAR); issues relating to effective management control and taxation of foreign companies in India; taxation of charitable organisations; shift from EEE to EET taxation system; taxation of income from house property in case of SOP by the individual; and taxation in case of salaried class employees,” he informed the Parliamentary panel.

Though the draft Code aims to modernise the decades old Income tax Act, a number of its provisions have not gone down well with the public and industry.

... contd.