Direct tax code to be introduced in monsoon session: Chidambaram

The Direct Taxes Code (DTC) Bill, which aims to overhaul the over 50-year-old I-T Act, is almost ready and will be taken up in the Monsoon session of Parliament, Finance Minister P Chidambaram said on Friday.

"I am just writing the Direct Taxes Code. We will introduce it in the Monsoon session. We have another week's work on that," he said.

The DTC Bill was introduced in Parliament in 2010 and was referred to the Standing Committee on Finance headed by senior BJP leader Yashwant Sinha.

Among other things, the Committee had suggested raising the income tax exemption limit to Rs 3 lakh as against Rs 2 lakh proposed in the original DTC Bill. On corporate tax, it recommended that the rate be retained at 30 per cent.

The Income Tax Act was enacted in 1961.

Responding to a suggestion on the need for a simple tax laws, Chidambaram said: "I don't know what a simple tax code is. The point is a tax code cannot be written in five pages. A tax code will run into few hundred pages...I don't think you can write a simple tax code."

He said India's Income Tax Act or all the pages related to direct taxes is only a fraction when compared the number of pages that are there in the United States.