Sources said the government has proposed to invite proposals from the private sector and tax experts on the Income Tax Act, 1961, starting from October, as part of an exercise to simplify the direct tax law. In a meeting with industry chambers earlier this month, the government said that a functionality would be created in the Income Tax Portal to include suggestions on various sections of the IT Act with the aim of simplifying the language and reducing litigation. can be given.

After the budget was announced, the Central Board of Direct Taxes (CBDT) had set up an internal committee to comprehensively review the six-decade-old direct tax law and make it concise, clear, easy to read and understand.

“In a meeting with industry associations, the revenue department suggested that by the first week of October, the functionality to give proposals for reworking the Income Tax Act should be prepared,” said a source.

Another source said the exercise is not about writing a new tax law or tax code.

“Just by removing obsolete clauses, the number of pages can be reduced by around 100. The aim of the revision of the IT law is to simplify the language and reduce litigation,” the source added.

Finance Minister Nirmala Sitharaman had proposed in the budget for 2024-25 presented in July that the review of the IT Act would be completed in six months.

Considering that the six-month timeline ends in January, it is widely expected that the amended IT Act could be brought up in the budget session of Parliament.

Another source said that since no new changes are expected in the law, the amended act may also form part of the Finance Bill 2025.

“It may be that the revenue department is considering incorporating the amendments suggested by the industry in the first draft and then putting the amended draft law in the public domain,” said a source.

(This story has not been edited by News18 staff and has been published by a syndicated news agency – PTI)