The salaried class who pay income tax at source always look towards government for concessions on tax rates in every budget year after year. While they pay income tax at source, many other class of citizens like traders, small businessman, professionals like doctors and lawyers find ways to evade tax though their actual income may be well above taxable limits. Financial analysts are also repeating time and again that the government should focus on increasing the tax net instead of announcing fresh income tax measures, endless surcharge and cess. The senior citizens who are not covered with any pension scheme and whose only source of income is interest earnings from their life time savings are badly hit in the recent times due to falling interest rates.
It is estimated that only about 3 per cent of over 1.25 billion people in the country are paying income tax. The number of people who declare annual income of over Rs 1 crore is abysmally low at just around 50,000 in the country which is an insignificant figure of just 0.004 per cent. Looking at the prosperity of the people with few economic health indicators like palatial houses, numbers of cars & SUVs they possess, frequent air travels within & outside the country will definitely establish that many of them may be tax evaders.
The government's recent move to demonetise Rs 500 & Rs 1000 notes to weed out black money and efforts to compel people to use of e-transactions, plastic money, mobile wallets and opening of bank accounts by more & more people should yield surprIsing result in few years in widening the tax net. The government should also put a limit on cash transactions to avoid creation of black money. With the widening of tax net & greaters compliance due to technological benefits, it is hoped that the government will find it easier to reduce tax rates in near future, may be in the forthcoming general budget.
It is estimated that only about 3 per cent of over 1.25 billion people in the country are paying income tax. The number of people who declare annual income of over Rs 1 crore is abysmally low at just around 50,000 in the country which is an insignificant figure of just 0.004 per cent. Looking at the prosperity of the people with few economic health indicators like palatial houses, numbers of cars & SUVs they possess, frequent air travels within & outside the country will definitely establish that many of them may be tax evaders.
The government's recent move to demonetise Rs 500 & Rs 1000 notes to weed out black money and efforts to compel people to use of e-transactions, plastic money, mobile wallets and opening of bank accounts by more & more people should yield surprIsing result in few years in widening the tax net. The government should also put a limit on cash transactions to avoid creation of black money. With the widening of tax net & greaters compliance due to technological benefits, it is hoped that the government will find it easier to reduce tax rates in near future, may be in the forthcoming general budget.
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