TDS rates may be restructured
By siliconindia   |   Monday, 22 June 2009, 19:20 IST   |    1 Comments
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TDS rates may be restructured
Bangalore: The government is considering to counter the rates applicable to the Tax Deducted at Source (TDS).The decision comes in the wake of the Income Tax department's pitch to the government to structure three slabs, of between one and five percent for any stream of income. TDS deducted by a taxpayer while paying dues to the assessee, is the final tax payable by an assessee receiving any income as salary. The government is considering the proposal to restructure these rates, which at present start from 1 to 30 percent. Moreover, monitoring TDS payments is difficult at present since some rates are specified in individual sections that deal with the tax treatment of a particular income and others are included in separate schedules. Streamlining the rates will make it easier to monitor these payments since time and manpower will also not be wasted. TDS contributes around 33 percent to tax collections. To balance the revenue loss from streamlining rates, the IT department has proposed bringing more income streams under the TDS domain. For instance, reinsurance commission received from firms and rental income paid for vessels of shipping companies that are chartered can be brought in the TDS ambit.

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