Decision on tax code deferred, Parl panel to meet on 17 Feb

New Delhi: The Standing Committee on Finance, which is understood to have suggested raising I-T exemption limit to Rs 3 lakh under the Direct Taxes Code, today postponed adoption of its report on the proposed legislation, as certain issues are yet to be resolved.

The meeting of the Committee chaired by senior BJP leader Yashwant Sinha considered the draft of the report on the proposed Bill at its meeting. “The entire report needs to be discussed and the committee members felt that they should meet again before adopting the report,” sources said.

[caption id=“attachment_209644” align=“alignleft” width=“380” caption=“The meeting of the Committee chaired by senior BJP leader Yashwant Sinha considered the draft of the report on the proposed Bill at its meeting”]  [/caption]

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Accordingly, it was decided that the Committee will meet again on February 17, 24 and March 2, they added. The committee, according to sources, wants the government to raise the income tax exemption limit to Rs 3 lakh in view

of the near double-digit inflation which has eroded purchasing power of rupee. The Bill has a provision to raise the limit to Rs 2 lakh.

Finance Minister Pranab Mukherjee had tabled the DTC Bill in Lok Sabha in August and was referred to the Standing Committee for scrutiny.

The draft report, prepared by the Committee, has also suggested categorisation of the home and commercial property for the purpose of income tax. The income from these two sources should be accorded different tax treatment, it said.

It wants the government to incorporate provisions to prevent misuse of the facilities and tax relief provided to People of Indian Origin (PIOs). The DTC, which seeks to modernise the direct taxation system, will replace the Income Tax Act, 1961. Although the government is unlikely to introduce the DTC

from April 1, 2012, as planned earlier, it may incorporate some of the provisions of the proposed law in the Budget for 2012-13, to be unveiled on March 16.

PTI