The revised draft of Direct Tax Code (DTC) has brought some good news for the govt employees. It proposes tax exemption on retirement benefits, the Public Provident Fund (PPF), the Government Provident Fund (GPF), the Recognised Provident Funds and the Employees Provident Fund and addresses important issues such as Minimum Alternate Tax (MAT).
The government intends to introduced the DTC in the monsoon session of the Parliament to replace the current Income-Tax Act. In the earlier draft of the DTC released last August the finance ministry had proposed to tax all the tax saving instruments at the time of withdrawal. However, the limit of tax saving was increased to Rs 3 lakh in a financial year.
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