Budget 2016: Income tax exemption structure under FM Arun Jaitley scanner

By: | Published: February 29, 2016 10:59 AM

Budget 2016: The much-awaited Union Budget has huge expectations from Finance Minister Arun Jaitley to remove certain unwanted discretions as part of an exercise to streamline taxation structure and improve the country's image as an attractive investment destination.

Budget 2016: The much-awaited Union Budget has huge expectations from Finance Minister Arun Jaitley to remove certain unwanted discretions as part of an exercise to streamline taxation structure and improve the country’s image as an attractive investment destination. According to the Finance Ministry sources, an exercise is conducted to bring out clear cut guidelines on taxation with a view to prevent controversies pertaining to retrospective amendment of tax laws.

Budget 2016: The stress will be on transparency, predictability and stability in the Indian taxation system. Jaitley had in the last Budget announced phased reduction in corporate tax to 25 percent from the current 30 percent and elimination of tax exemptions to companies. Regime of exemptions has led to pressure groups, litigation and loss of revenue, and also leaves room for discretion.

Budget 2016: “Following recommendations from various departments, there is a need to have a fresh look at the existing income tax exemption structure. The exercise holds importance as it will help in reducing discrepancies and discretions in the exemptions as well as introduce the much needed transparency in taxation,” sources added.

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