- Changes to the
Direct Tax Code is set to hit India’s rich, according to a report. - The government had appointed a task force that was headed by CBDT member Akhilesh Ranjan. This committee was given the task of submitting a report on the new Direct Tax Code.
- A person will be considered as a non tax resident, only if the individual has not been living in India for seven of the last 10 years.
According to a report by Taxsutra, there could be multiple changes to the Direct Tax Code which could impact the resident rule.This is as per the recommendations of a government-appointed task force headed by CBDT member Akhilesh Ranjan.
182 days to 90 days
The committee recommended the government to change the residence rule. Currently, an individual has to be present in India for 182 days or more to be considered a resident. The report highlights that as the current ‘182 day test’ is being misused, the committee asked for the number to be brought down to 90 days.
Furthermore, a person will be considered as a non-tax resident, only if the individual has not been living in India for seven of the last 10 years. It will cover a lot more individuals who spend half of the year abroad.
Super rich will also have to cough up more as the existing tax rules too. In the last Budget, Finance Minister Nirmala Sitharaman hiked the tax for the super rich in India. She had announced that people earning over ₹5 crore a year would have to pay an additional surcharge bringing up their effective tax rate to 42.7% of their income.
Now, Indians who badly want to escape tax might have to take up extreme measures like living in yachts in international waters and land occasionally to evade tax in every country!
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