Key changes proposed in Income Tax Bill to be tabled in Monsoon session
While most of the changes proposed were minor in nature – change in language and correction of typos – three key amendments suggested by the committee.
The committee has advised against the provision that would have disallowed income tax refunds if returns were submitted beyond the stipulated due date. This change offers considerable relief to taxpayers.
A proposal has also been made to bring back provisions enabling the tax department to issue a nil withholding tax certificate for specific payments. This clause was initially omitted from the draft bill, which previously only permitted certificates for low TDS deductions.
The 31-member select committee, which was headed by BJP leader Baijayant Panda, has also recommended the restoration of Section 80M allowing deduction in case of inter-corporate dividends. Its earlier removal had sparked concerns about potential double taxation within complex corporate structures. Reports indicate the government has accepted this recommendation, offering substantial relief to businesses.
According to Gaurav Makhijani, Head of Tax (North India and Gujarat) at Roedl and Partner, The Select Committee has taken into account most of the significant concerns raised and has sought to address areas that were causing ambiguity.
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