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LOOP HOLES IN TAXES DTC (DIRECT TAX CODE)
MEANING :- LOOP HOLES
Ambiguity in a system Which can be used to avoid procedure
of system
DEFINITION
Exploitation of a tax law which can reduce or eliminate tax Legal, taxation strategies that are
exploited for personal gain.
HOW IT WORKS
Local development law that requires
An unoccupied building to pay real estate taxes so long as it receives a certificate of completion
Builder :- choose not to "complete" the building.
SOME WAYS TO AVOID TAX
Contributing to charity Deferred Income Do a Bond Swap Tax break
WHY IT MATTERS????
Exploiting loopholes may lead to
intensive scrutiny and audits
Reducing our facilities
DIRECT TAX CODE
Direct Tax Code is a combination of major tax relief and removal of most tax-exempted benefits
a document containing changes in Exemptions, Tax slab
CONTD…..
New tax slab
INCOME SCOPE TAX PERCENTAGE
LESS THAN 1.6 LACS 0%
1.6 – 10 LACS 10%
10 – 25 LACS 20%
25+ Lacs 30%
FEATURES
Exemption on Education loan
On LTA (Leave travel allowance) is abolished
Tax on dividends 5 %
Only half of Short-term capital gains will be taxed
Surcharge and education cess are abolished.
ADVANTAGES
Whole process much simpler
a new face to the Indian economy
Generate more tax revenue
reduces the corporate tax to 25% from the current 34%