Direct Taxes Code may miss April 2013 deadline

Finance Minister P. Chidambaram has indicated that it may be difficult for the government to meet the April 1, 2013 deadline for the implementation of the Direct Taxes Code (DTC).

Speaking to reporters after meeting the chief commissioners of excise, customs and service tax in the capital, the minister indicated that he was not sure whether the DTC would be implemented by April 2013 as "it needs a fresh look". On being asked further, he said: "It has undergone many reviews and I am just 28 days old in the finance ministry right now".

On being asked what the fate of the General Anti Avoidance Rules (GAAR) would be if the DTC gets pushed beyond 2013, he said: "The Shome panel is looking into it. Let's see after the report come in."

NDTV had first reported on July 30 that DTC may get further delayed, just a day before Mr. Chidambaram took over as the Finance Minister.

The first draft of the Direct Taxes Code Bill was prepared under the guidance of Mr. Chidambaram in 2008, but he then had to move to the Home Ministry after the Mumbai terror attacks. The DTC has undergone a substantial dilution since then.

In this year's Budget the government, however, announced the roll out of GAAR, despite postponing DTC to next April. GAAR, too, was postponed later by a year under strong opposition from foreign institutional investors.

Last month, the Prime Minister appointed an expert panel headed by Dr Parthasarathi Shome of ICRIER to suggest a fresh roadmap or the implementation of GAAR.

The expert panel is expected to submit its report by August 31.