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Finmin Sets up Study Group on CTC for Service Tax, Excise
The finance ministry on Monday set up a study group to look into the possibility of a common tax code (CTC) for service tax and central excise duty.
‘‘A study team has been set-up by the government, under the leadership of MK Gupta to examine the possibility of a common tax code for service tax and central excise, which could be adopted to harmonise the two legislations,’’ a finance ministry statement said.
The study group would submit its report to the finance minister by September 30, 2012. The government is in the process of coming out with a direct taxes code (DTC) with a view to replace the archaic income tax Act.
The study group would look at procedural simplification of the existing input tax credit scheme and suggest ways to mitigate cascading effect of taxes. It will also endeavour to make the CTC trade-friendly.
‘‘The team may also suggest any other measure that will help in reducing the cost of compliance for business or transition towards a comprehensive goods and services tax (GST),’’ the statement said. The new code would be implemented under the present Constitutional scheme, it added.
Gupta, who is a former vice-chairman of the customs and central excise settlement commission, would interact with various chambers of commerce and industry and industry associations before finalising its report. Pointing out that service tax law is complex and sometimes avoidably different from Central Excise, Mukherjee said "we need to bring the two as close as possible in the light of our eventual goal of transition to GST’’.
Financial Express, New Delhi, 10-04-2012