The Government is likely to place in the public domain by next month a revised discussion paper on the proposed Direct Taxes Code (DTC). After a quick round of consultations with some of the major stakeholders, the draft legislation (Bill) on DTC will be introduced in Parliament in the Monsoon Session, the Finance Minister, Mr Pranab Mukherjee, told the Lok Sabha here on Wednesday.
He also reiterated the Government’s commitment to usher in comprehensive tax reform through the introduction of DTC as well as the Goods and Services Tax (GST). The Centre has already indicated its intent to introduce GST from April 1, 2011.
Mr Mukherjee said that the Centre was willing to provide compensation to the States for the initial years of the GST regime. However, this was contingent on there being an agreement on the broad framework for a common threshold for goods and services between the Centre and the States, common exemption lists between the Centre and the States, mechanism to check deviations and acceptable level of overall GST rates.
The design and modalities of providing this compensation would be worked out in discussion with the State Governments and the Empowered Committee, he said.
Meanwhile, Mr Mukherjee said that the Indian economy is expected to grow by 8.5 per cent during 2010-11 and to breach the 9 per cent mark in 2011-12. The outlook is further brightened by the fact that a normal monsoon is predicted this year.
That will be the beginning of the end of the long established, time-tested IRS. And this is inevitable, as the IAS want it. Sad, but let us accept that, ultimately, even the political bosses must bow down before the deeply entrenched IAS.
The DTC,GST in present form if enacted now shall either become redundant or require a complete overhaulling on adoption of IFRS.The suggestive recourse is that, the Govt. should go ahead with the task of making Indian GAAP converged with IFRS first and after that DTC,GST.As under the regime of IFRS,the present accounting system shall need a complete overhaulling which in turn shall have a direct bearing on tax administration.