Online Trading India

Mutual Funds

Share Market
Credit Card

We are in need of a simplified tax regime!

A FEw weeks ago the dilemma of tax overruled the employees, businessmen and labourers, “Tax rules must be clear-cut if the government wants to lower tax arrears.”

Back in time, around four years ago, the political history reads that the Indonesian finance minister, Mulyani Indrawati invited CEOs & Industry biggies to banquets.

She would offer presentations on the budgetary in the meeting and it included the lists of those who are and who are not signed up for tax liberty from the government.

Looking into India’s new tax regime, “Vivad se Vishwas”, meaning from dispute to trust. The government’s idea towards public service is ideally muddled by several political bodies. The primary motto of the new tax regime is to offer inclusivity of moderation in case of revenue returns and end litigation.

 

The government intend to:

The taxpayer would have to pay the full amount of the disputed tax in return for a complete waiver of interest and penalty if she opts for the scheme before the end of this fiscal.

 

But will this help?

There were revisions made on the new tax regime by the cabinet, making the scheme look more attractive to taxpayers. So, in cases where a taxpayer has won earlier in a lower forum, and the department is in appeal, she will have to pay half the disputed amount.

 

The revisions upheaval!

The customer who holds more than Rs. 5 lakhs is accountable to the amount exceeding this limit. The unaccountable income or the black money, in other words, if then does rest in your account, you’re in trouble. Unless, it is proven otherwise by the depositor, as the burden of proof rests on her.

 

Dating today, the assessments are in use as it is appealed for long many years.

Clear Cut Call!

Tax rules must be clear-cut if the govt wants to lower tax arrears. The companies that are listed under the tax liberation scheme have no incentives or a need to hide their income. Given that they want to maximise their market capitalisation otherwise. 

The goods and services tax (GST), with its multiple audit trails, will broaden the base of direct taxes when data is mined, helping tap undisclosed incomes by individuals and businesses.

Elaborating the tax administration mindsets to be inclusive of tax collection, rather than complicate overhauling schemes.

 

The reality!

If we’re to make a guess, how many Indians will pay tax for the current financial year? Slightly over 1 per cent!

The current financial year (2019-20) nearly 5.78 crore individuals filed returns. They disclosed their income for the financial year 2018-19. Out of these, about 1.03 crore individual taxpayers are not liable to pay tax. Why? Because they fall below the tax exemption window of INR 2.5 lakh.

Today, in the IT department, about 4.32 crore individuals reported income below INR 5 lakh in the financial year 2018-19. Assuming that this number will largely remain unchanged for the financial year 2019-20 as well, only 1.46 crore individuals will pay income tax for this financial year.

 

Income above INR 5 crore ~ 8600 only?

The datum also disclosed the income of 46 lakh individuals which is above INR 10 lakh. Out of these 46 lakhs, 3.16 lakh have income above INR 50 lakh. The government is surprised to see that the setback of the present taxpayers for INR income Rs 5 crore & more are just 8600!

 

 

 

 

(Visited 45 times, 1 visits today)