Finance Minister Pranab Mukherjee has announced number of income taxpayer-friendly steps in the Budget for 2011-12. Chairman of the Central Board of Direct Taxes
Sudhir Chandra says the idea is to make the whole tax collection regime humane.
In an interview with
Santosh Tiwari, the CBDT chairman spelt out the department's strategy behind the proposals associated with the direct taxes and the way forward. Edited excerpts:
What is the basic reason behind the proposal of exempting salaried class from filing income tax returns? This scheme would help salaried people, especially those working in far-flung and remote areas with armed forces and para-military forces. These people mostly do not have any other taxable source of income.
After, around two years of service, a majority of young employees joining the security forces come into the tax ambit and if they are exempted from filing income tax returns, they would be relieved.
Similarly, in other sectors too, if the is a singular source of income, then there is no need to file return. The necessary information comes to the department from the employers. This is a landmark scheme. Nowhere in the world is such faith reposed in the taxpayers.
The surcharge for corporates has been reduced from 7.5 per cent to 5 per cent and the minimum alternate tax has been increased from 18 per cent to 18.5 per cent. Is it revenue neutral? The additional revenue from MAT will compensate for revenue loss on account of reduction in surcharge. MAT rate has been increased to align it with Direct Taxes Code which has proposed the rate at 20 per cent.
What is the status on black money amnesty scheme?The finance minister has already said that such schemes cut both ways and pros and cons of any such scheme need to be weighed carefully.
The benefits to software units under Section 10A and 10B have not been extended. Why?Under DTC, only investment-linked schemes are allowed. This decision has been taken keeping in mind this sound policy view, and naturally there was no logic in extending the present provisions under Section 10A and 10B, which are profit-linked.
The only exceptions made are for the power sector and SEZ units, which have been allowed the benefit this year. I wish to assure that the benefit will not be taken away from the existing beneficiaries till they exhaust it under the existing provisions.