India to set up tax reform commission

The Indian government Tuesday said it will set up a tax administration reform panel to review application of tax policies and laws in the country.

The union cabinet chaired by Prime Minister Manmohan Singh approved the proposal of setting of the new body called the Tax Administration Reform Commission.

"The Commission will review the application of tax policies and tax laws in India in the context of global best practices and recommend measures to strengthen the capacity of the tax system in India that would reflect best global practices," said an official statement released after the cabinet meeting.

"The Commission will help in removing ambiguity in application of tax policy and tax laws, thereby establishing a stable tax regime and a non-adversarial tax administration. The Commission will facilitate an efficient tax administrative system that would enhance the tax base as well as tax payer base," it said.

The Commission will consist of a chairman, two full time members and four part-time members, of which at least two part-time members will be from the private sector.

The chairman will be an eminent person having wide experience of tax administration and policy making. Full-time members of the Commission will be one member each with a background in revenue service pertaining to Income Tax and Central Excise and Customs respectively, the statement said.

The term of the commission will be 18 months.