The government on Tuesday announced that it will undertake a comprehensive review of the Income Tax Act to make it easy to read.
Presenting the Union Budget for 2024-25, Finance Minister Nirmala Sitharaman has said the government will come out with SoP (Standard Operating Procedure) for TDS defaults and simplify and rationalise the compounding of such offences.
“I am now announcing a comprehensive review of the Income-tax Act,1961. The purpose is to make the Act concise, lucid, easy to read and understand. This will reduce disputes and litigation, thereby providing tax certainty to the tax payers. It will also bring down the demand embroiled in litigation. It is proposed to be completed in six months,” Sitharaman has said. She has also said that in Budget 2022-23, the government reduced the number of customs duty rates. “I propose to undertake a comprehensive review of the rate structure over the next six months to rationalise and simplify it for ease of trade, removal of duty inversion and reduction of disputes,” Sitharaman has added. Bery noted that fiscal consolidation is being maintained and improved in this year’s budget which is important.
According to him, the Budget proposals provide long term vision and it is the first step towards Vikshit Bharat.
Responding to a question on economic growth, Bery said it is easiest for India to increase its growth rate by increasing labour productivity and increasing the number of people who work.
“India has been doing well, but it can do better, should do better, and needs to do better,” he said.
According to Bery, a big push is given in this year’s Budget for the MSMEs who survived COVID pandemic shocks, Bery said.
Asked whether the Budget proposals will promote private consumption and private investments, he said private consumption has been primarily affected in the rural areas.
“So I think a lot depends on this year’s monsoon,” Bery opined.
He pointed out that the whole point about adjusting the tax slab and raising the deduction on income tax is to provide a bit more money for consumption.
“If the government’s efforts in fiscal consolidation and inflation control succeed then the interest rate will come down, and if interest rates come down, then that will help in increasing consumption of consumer durables, many of which are financed on EMI,” Bery explained.
Pointing out that private investment depends pretty much on the business environment, he said that the finance minister has come out with proposals in the Budget document to improve the ease of doing business, which is of course affected by the state government’s action as well as federal government action.