India’s current direct tax-to-GDP ratio is 5.6%. Still, it is significant that the government is thinking of lower tax rates because current tax rates and tax slabs are already more liberal than the ones suggested in an earlier draft direct taxes code prepared by a panel under the earlier United Progressive Alliance government. The current direct tax-to-GDP ratio is 5.6%. The broadening of the tax base will provide leeway to cut tax rates, said the official cited earlier. The finance ministry had on 22 November set up a task force with Central Board of Direct Taxes member Arbind Modi as convener and chief economic adviser Arvind Subramanian as a special invitee to draft a new direct taxes code in the light of global best practices and the economic needs of the country.

Source: Mint December 03, 2017 18:33 UTC