New Income Tax Bill to be concise with nearly 30 percent fewer sections, says report | Mint

After Cabinet cleared it, the new income tax bill is set to be tabled in Parliament next week. The new bill is expected to reduce the number of sections by 25-30 percent to make the law simpler and more concise, Business Standard reported quoting an official without naming him/her.

Even the provisos and explanations have also been removed, and the word count has been halved, it further mentions.

No excessive power

The official also confirmed that there is no excessive power and no excessive case of delegation.

The power relating to quantification of income and levy of rates remain with Parliament. Every single rupee has to be collected after Parliamentary approval, this is the fundamental principle of taxation and it can never change, the official said.

The report further quotes another official saying that the focus was on simplification, ease of understanding and clarity.

It uses lucid language, active voice and shorter sentences and will remove redundancy and hard-to-understand explanations. The income tax department wants the bill to go for public consultation to ensure transparency and garner public feedback.

Consulting stakeholders reduces the chances of ambiguities or legal disputes in the future, which will lead to a smoother transition to the new tax regime, the official said.

Standing committe

In one of the media interviews, Finance Minister Nirmala Sitharaman mentioned that the Bill will be presented in the Parliament before being referred to the standing committee on finance. The committee would then start the process of consultation.

The bill aims to resolve the issues which arise out of interpretation done by various courts of law.

There is an expectation that the new bill will avoid cross-referencing which means referring multiple provisions to make sense of what is said in one of them.

In a post-Budget interview with Mint as well, Ms Sitharaman had hinted that the new income tax bill will go to standing committee.

“Normally, standing committees go through this (kind of bill),” she said.

In the same interview, she also said that the new law will be concise with at least half the size.

“This will be simpler than what it was earlier, it will be easier to comply, it will use less words to convey the same things. And several amounts which we used as either benchmark or ceiling are all being reviewed— whether they are relevant today, whether they need to be there today,” she said.