New Income Tax rules in Modi government 2.0? Here's what to expect

New Direct Tax Code: Taxpayer? You may expect the introduction of a new direct tax code soon. The task force set up to draft a new direct tax law to replace the existing Income Tax Act is scheduled to submit its report in the next two months. On Friday, the task force was given two-month extension till July 31 to submit its report. Earlier, the task force was scheduled to submit the report by May 31.

"Finance Minister Arun Jaitley Friday extended the last date for submission of report by direct tax panel till July 31," news agency PTI quoted an official as saying. 

The fresh extension means the direct tax panel may submit its report after the presentation of full Budget for 2019-20.

In 2014, the budget was presented on July 10 after the Lo Sabha elections. Going by precedence, the full year 2019-20 budget is likely to be presented in July. 

In November last, the Finance Ministry had appointed Akhilesh Ranjan, Member (Legislation), CBDT, as convenor of the task force after the retirement of Arbind Modi. Other members of the task force include Girish Ahuja (chartered accountant), Rajiv Memani (Chairman and Regional Managing Partner of EY), Mukesh Patel (Practicing Tax Advocate), Mansi Kedia (Consultant, ICRIER) and G C Srivastava (retired IRS and Advocate).

In an annual conference of tax officers in September 2017, Prime Minister Narendra Modi had observed that the Income-tax Act, 1961, was drafted more than 50 years ago and it needed to be redrafted.

The task force has been asked to draft direct tax laws in line with the norms prevalent in other countries, incorporating international best practices, and keeping in mind the economic needs of the country. The panel was initially supposed to submit its report to the government, within 6 months, by May 22, 2018, which was further extended till August 22. Following Arbind Modi's retirement on September 30, 2018, Akhilesh Ranjan led panel was tasked to submit report by February 28, 2019. It was then extended till May 31.