TAX AND ITS ORIGIN
Tax is a mandatory liability for every citizen of the country. There are two types of tax in India:
Taxation in India is rooted from the period of Manu Smriti and Arthashastra. Present Indian tax system is based on this ancient tax system which was based on the theory of maximum social welfare. It was only for the good of his subjects that he collected taxes from them, just as the Sun draws moisture from the Earth to give it back a thousand fold-By Kalidas in Raghuvansh eulogizing KING DALIP.
BRIEF HISTORY OF INCOME TAX IN INDIA
THIS ACT IMPOSES A TAX ON INCOME UNDER THE FOLLOWING FIVE HEADS:
(i) Income from salaries
(ii) Income from business and profession
(iii) Income in the form of capital gains
(iv) Income from house property
(v) Income from other sources
IN TERMS OF THE INCOME TAX ACT, 1961, A PERSON INCLUDES:
TAX SLABS IN INDIA:
(i) The Latest income tax slabs based on the Union budget presented on 29 February 2016.
(ii) The Minister of Finance Mr. Arun Jaitley presented the union budget on 29 February 2016. Following are the major highlights of the latest income tax slab.
WHY ARE TAXES IMPOSED?
LET'S LOOK AT THE REASONS WHY DO WE PAY TAXES?
1. To Provide Basic Facilities for Every Citizen of the Country: Whatever money is received by the government in terms of direct tax and indirect tax is spent by it for the welfare of the citizens of the country. Some of the services provided by the government are: health care, electricity, roads, education system, free houses for poor, water supply, police, firefighters, judiciary system, disaster relief, taking care of bridges and other things of public welfare.
2. To Finance Multiple Governments: All the local government of the state like village panchayats, block panchayats and municipal corporations receive fund from the state finance commission.
3. Protection of the Life: Tax payers receive the protection of life and wealth from the government in case of external aggression, internal armed rebellion or any other situation in exchange of tax paid by them.
DISSATISFACTION WITH TAXES
We often hear that there are so many scams in the country which confiscates the precious public money. There are so many other reasons given below, which lead to dissatisfaction with taxes.
a. Rate of tax is too high.
b. Unfair collection of tax from the people. Some rich people pay less tax while poor people pay high and vice versa.
c. Government is wasting tax money (inefficiency).
d. Government is spending money on wrong or unnecessary things.
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1. What is the history of Income Tax in India? |
2. What are the Income Tax Laws in India? |
3. What is the significance of income tax in India? |
4. What are the penalties for not filing income tax returns in India? |
5. How can one reduce their tax liability in India? |