The taxpayers can switch tax regime every year of their comfort. The new tax regime offers lower slabs without providing any exemptions, said by the Central Board of Direct Taxes (CBDT) chairman PC Mody.
However, business people don’t have this option of switching. “Let it be very about this is an optional scheme – there’s no compulsion for you to switch to the new regime,” he said at an event on Tuesday.
“If you find the new scheme is preferable, then you can switch to it. If you’re better off in the old scheme, then you can continue.”
Finance Minister Sitharaman announced new slabs in February 1 budget. “The option of switching is available to you for a year-on-year basis – that’s a very interesting point,” Mody said.
“If I feel a certain deduction benefits this particular year, I prefer the old regime is better, I opt for that. But if a new regime offers me a better rate, I can opt for it.”
Therefore these tax slabs are not meant for persons with business, said Mody.
The chairman said deduction and exemptions will gradually implement to make the tax structure simple and easier to follow with, Sitharaman said.
The government is also planning to provide pre-filled income tax returns for an easy process of filing returns.
The government will ask the taxpayers and convince them that they will not be unnecessary harassment. Sitharaman said that CBDT will adopt a taxpayer charter to ensure harassment is eliminated.