- The Central Board of Direct Taxes (CBDT) has decided to expand the terms of reference for the committee that has been formed to re-write the Direct Tax Code(DTC).
- The committee will now have to consider five more areas while drafting their recommendation making the total terms of reference nine.
- The existing terms of reference included drafting a direct tax law in line with the norms prevalent in other countries,incorporating international best practices and keeping in mind the economic needs of the country.
- The new additions include the creation of a faceless and anonymised verification and scrutiny system and the sharing of information between GST, Customs,CBDT and the Financial Intelligence Unit.
- Further,the other terms of reference added includes setting up a mechanism for cross-verification of financial transactions and reduction in tax-related litigation.
- Direct taxes are levied on a person’s or a firm’s income or wealth.The incidence and impact of the direct tax fall on the same person.Example: Income Tax,Corporation Tax,capital gains tax and Wealth Tax.The impact of direct tax is not Inflationary.
- Central Board of Direct Taxes(CBDT) is a statutory authority on direct taxes.It functions under the Central Board of Revenue Act,1963.It is a part of the Department of Revenue in the Ministry of Finance.
- CBDT provides inputs for policy and planning of direct taxes in India and is also responsible for the administration of direct tax laws through the Income Tax Department.
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