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Q.

Income tax exemptions and raising the limit benefit only a small percentage of the population. In fact collecting personal income tax on salaried sector occupy about one third of income tax department man force and expenses.Is it not better to abolish income tax on salaries altogether?

Tags: money, tax, income tax
Asked by Josna, 19 Jan '10 06:25 pm
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Answers (4)

1.

Yes true./. the main moolah lies with the business class and those in the entertainment industry like Bollywood stars.
So it would be better to target them and extract all their unpaid taxes. Bedsides the government should also learn to prune its expenses and save money.
Answered by joyoti sen, 20 Jan '10 08:46 pm

 
  
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2.

How would the govt get revenue then w/o tax collections? Even the most ultra free market capitalist Adam Smith professed that govt needs taxes to run.

The problem of distributing Govt income benefit and burden is pretty OK on the on the G2C side (govt to consumers ala people where employment is caterogized under) but the G2B (Govt to business) policy of income benefit and burden distribution....u wonder if the policy was charted by a crack head for 2 dollars.

In Indian G2B policy, for FMCG (Fast Moving Consumer GOods) exporters get SUBSIDY....a whopping 17 percent cashback on select industry! But then, a start up local business gets a nice and fat 12 percent commercial sales tax :D

If you have an exporting Co., either as factory or as agent, u have enough money for foreign representation. So u don't need subsidy. But if u r a local entrant and newcomer to the biz having issues w/ cash flow- that's when u need subsidy the most. But GoI taxes the local new entrant and pours ...more
Answered by A Moin, 19 Jan '10 09:27 pm

 
  
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3.

The salaried class is the only people in the tax net who make prompt payment of Income tax, not because that they are more law abiding and more patriotic but because they cannot falsify the accounts on "Income from salaries", The statement that about 33% of the man-power of the Income ax Dept is deployed for assessment and collection of income tax from the salaried employees is highly exaggerated, The responsibility of assessing, collecting and remitting the income tax from the salary of the employees rests with the Head of office or the Officer/person responsible for making payment of the salary (section 194 (c) of the IT Act), So the role of the personnel of the Income Tax Dept in assessing and realising the income tax from the salary of the employees is minimal, Then, the "Net Proceeds" of the Income Tax is distributed among the State Govts by the Central Govt, By "Net Proceeds of the Income Tax", the surplus amount of the Income tax collected and available with the Central Govt i ...more
Answered by thampy chacko, 19 Jan '10 07:23 pm

 
  
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4.

Good suggestion.
Answered by dare devil, 19 Jan '10 06:41 pm

 
  
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