Almost all the finance ministers of India have faced the challenge of widening the tax net of the country. While the debate on how old people are old to pay income tax in India are less, which is less well known that many companies also avoid paying income tax. While only 2% of the population pays income tax, about half of companies that file ITRS (ITRS) do nothing.
How to widen the tax net is an important question without any clear answer. Tax evasion, low wage increase, high unemployment and high exemption limit means very few people qualify to pay income tax. Additionally, accounting provided in 2019, very few corporations actually pay income tax as a result of waist, low audit quality and income tax relief. It is true that the number of returns filed by individuals has exceeded double, from 3.35 crores to 7.54 crores in 2013-14 to 7.54 crores. However, many of these are zero-tax returns, which have been filed only for compliance purposes. During the same period, the number of persons filing zero-tax tax returns has exceeded double, during the same period, it has increased from 1.69 crore to 4.73 crore. The result of this is that the number of individuals paying income tax has actually increased between 2013-14 and 2023-24-from -66 crore to 2.81.
Growing exemption limits
The exemption limit has been increased sequentially from 2013-14. From Rs 2 lakh, it has effectively gone up to Rs 7 lakh by 2023-24. In 2013–14, half of all the returns filed were zero-tax. By 2023-24, this part went up to 63%. In individuals paying taxes, about half (47%) reports income up to Rs 5 lakh; 37% Rs. 5-10 lakhs, 13%between rupees. 10-25 lakhs, and income above only 1% income. 50 lakhs.
While exempting income tax slab over years, it can lead to political understanding, it does not understand economic, especially when 84% of the population earns less than Rs. 10 lakhs per year -per capita income of India is about Rs. 2 lakh- and people Rs. 7 lakh is not required to pay income tax under the new tax regime. In India, 90% of eligible eligible taxpayers pay up to money without any tax. 1.5 lakhs.
Top 1% of ITR filers pay 50% of India’s total individual income tax collection, while the top 9% pay 87% of the total tax, highlight significant inequality and face challenges in widening the tax net Are. This is a large burden on these top 10% filers.
Corporate filing
The situation between corporations is worse. Of a total of 10.7 lakh corporate ITR filers, 57% reports zero income, and earns another 33% rupees. 0-50 lakhs. Overall, 90% of companies only Rs. Report up to earnings. 50 lakhs (Corporations are taxed on profits, not income). Half (48%) of corporate filers pays zero income tax, while Rs. 36%. Pays between 0-5 lakhs in income tax. In terms of value, 84% corporate filers were Rs. The total corporate tax collection did almost nothing. 7.16 lakh crore in assessment year 2023-24. Again, the top 1% of corporate ITR filers pay 85% of the total corporate income tax.
All this highlights important inequality and questions the financial health of companies in India. Another grip is that agricultural income is free from taxation – it is half the population of India. While it is understood by socio-economic understanding, at least rich farmers can be brought under tax realm to promote tax collection.
Personal income tax, corporate tax, and GST collections account for one third of the total central government receipts. Both individuals and businesses can bring them into additional revenue while tightening the efforts to combat tax evasion, as well as the limit of taxation. The government will need to focus on increasing revenue through indirect taxes, while a reproduction of a money tax will also have to be considered.
(Amitabh Tiwari is a political strategist and commentator. In his first avatar, he was a corporate and investment banker.)
Disclaimer: These are the personal opinions of the author
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