Citizen questions if income tax is even needed in India

Sat, 22 Jun 2024

A recent tweet by @D.Muthukrishnan highlighted the skewed nature of income tax in India. According to the tweet, a mere 1.5% of the population pays taxes, while only 0.3% of the Indian population, approximately 4.5 million people, contribute to 80% of the country's income tax revenue.

The tweet also suggests that indirect taxes might be a more effective way to generate revenue. However, it is essential to note that income tax serves as a vital source of funds for the government, which can then be used for various public welfare programs and infrastructure development projects.

The debate on income tax rates has been ongoing in India, with some arguing that a reduction in taxes would lead to increased consumer spending and economic growth. Others believe that the current tax system needs to be reformed to ensure that those who are able to pay their fair share do so.

As the Indian economy continues to evolve, it is crucial to reassess the country's tax policies and identify areas for improvement. Whether income tax remains a necessary component of India's fiscal landscape or if indirect taxes become the primary source of revenue, one thing is certain: the conversation around taxation needs to continue in order to ensure that the country's economic growth is sustainable and equitable.

Published by Chronicles Of India. Scroll down to read more