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New section 134A: Power of Director General to issue Guidelines

Finance (No. 2) Bill 2023 proposed that the Income Tax Act 1967 is amended by inserting after section 134 the following section:

Power of Director General to issue guidelines

134A. (1) The Director General may issue guidelines as the Director General thinks expedient or necessary to clarify the provisions of this Act or to facilitate the compliance of the law or any other matter relating to this Act.

(2) The Director General may revoke, revise or amend the whole or any part of any guidelines issued under this section.”.

The proposed new section 134A in the Finance (No. 2) Bill 2023 grants the Director General the authority to issue guidelines to clarify the Act's provisions or facilitate compliance with the law.

This new section empowers the Director General to issue guidelines for various Income Tax Act 1967 matters.

The guidelines can be revoked, revised, or amended either in their entirety or in part by the Director General.

The tax impact of this amendment lies in the enhanced flexibility for the tax authority to issue guidance, ensuring better understanding and adherence to the provisions of the Income Tax Act 1967, which may impact the tax compliance and practices of individuals and entities.

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