New Direct Tax Code will be effective from April 1, 2012

The much awaited Direct Tax Code (DTC) will be effective from April 1, 2012. It was scheduled to be effected in 2011. Direct Taxes Code Bill has been tabled in the Parliament and it will go to the appropriate committee, said the Finance Minister of India, Pranab Mukharjee.

The Direct Tax Code(DTC) will give some relief to the tax payers of the country. There is reduction in the slabs of direct taxes for both citizens and senior citizens. According to media reports, the tax exemption in the income tax has been increased to Rs 2 lakh from Rs 1.6 lakh earlier and the senior citizens can get exemption up to 2.5 lakh rupees. There will be three tax slabs on short-term capital gains — 5%, 10% and 15%.