Lower taxes, simplify tax laws The entire tax regime - both direct (personal and corporate income tax) and indirect - needs a revisit. Given that less than 3% of the population shows any taxable income at all, theres clearly a need to bring many more into the net instead of burdening the already taxed. Its also high time the field is levelled and rich farmers were made to pay income tax. Tax rates for personal taxpayers should be made more reasonable, in keeping with inflation, if nothing else. The salaried class would benefit from reintroduction of standard deduction (a flat amount that is deducted from income, with the balance subject to tax). The bulk of taxpayers comprise the salaried class and reintroduction of standard deduction, abolished from April 2005, is the simplest way to usher in an additional tax reform for this class. This will also usher in equity, as currently individual taxpayers who are professionals or businessmen are entitled to offset their business expenses against income. Salaried taxpayers only get certain tax sops - such as HRA, LTA, medical or transport allowance - but these in large cities translate into peanuts, such as the Rs 800 per month tax-free travel allowance. From “TOI manifesto: An agenda for the new government”
Posted on: Sat, 15 Mar 2014 05:42:05 +0000