Finance Minister P. Chidambaram has said that the Direct Taxes Code (DTC) needs a fresh look. The Government intends to introduce the new system of taxation of individuals and corporates along with other direct taxes from April 1, 2013.

Asked if the Government will be able to keep this date, Chidambaram said, “I can’t say. DTC has gone through various versions... I need time to look at DTC. I am only 28-days old... It requires a fresh look.” He was addressing a press conference after a meeting with top officials of Central Board of Excise and Customs.

DTC seeks to replace the Income-Tax Act, 1961. The new system was mooted by Chidambaram himself during his earlier stint as Finance Minister in UPA-I. However, much of the drafting of the Code was done after he shifted to the Home Ministry in 2008.

His successor Pranab Mukherjee introduced the DTC Bill in 2010 which also included a number of new provisions, followed by the changes suggested by the Parliament Committee on Finance. The controversial provisions relating to retrospective tax amendments and General Anti-Avoidance Rules (GAAR), parts of the draft DTC, were enacted in the Finance Bill, 2012.

The Government has already announced that GAAR will be implemented from April 1. Asked if GAAR would get postponed further, Chidambaram said he was awaiting the report of the Shome Committee, which is looking into the concerns expressed by foreign and domestic investors. On the Goods and Services Tax (GST), he said that after his meeting with the Chairman of the Empowered Committee of States’ Finance Ministers, Sushil Modi, he is hopeful of having the Bill by the end of the financial year. The Constitution Amendment Bill for GST is currently with the Standing Committee of Finance. Introduction of GST has been postponed several times and no fresh date has been set.

> Shishir.Sinha@thehindu.co.in

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