India may be one of the fastest growing economies in the world, but the fact is that nearly 3% of its population currently pay income taxes, and many government efforts to increase tax compliance and tax base have failed to bear many results so far. Even though the new taxpayer has increased to 84.21 lakh in 2016-17 from 66.53 lakh to 26.6 percent in 2016-16, following monetization of high-value currency notes, is it enough? Have you ever wondered why a large number of people still in India are eager to pay taxes? One of the main reasons is that they believe they do not get anything in return, social security or other benefits, even if they pay taxes or more taxes than others, but it is not entirely true.
Whatever the case, tax experts believe that salaried individuals often follow taxation, because the tax on wages income is deducted from the source by the employer. Likewise, the income received by individual taxpayers, such as interest on bank deposits on a particular threshold, is subject to tax registration by banks automatically registered by tax officials.
"The challenge is sometimes wrong in the case of income earned by businesses and businesses. There are various reasons for inadequate compliance, including high rates of taxation, fear of verification and evaluation procedures, in case of time and effort, lots of complaints, including co-operation to satisfy compliance requirements, excessive litigation etc. In addition to the cultural decades, people are not compatible with tax rules Due to the lack of waste and strong enforcement this issue is added. Therefore, we can say that in some cases there is lack of mentality issues and law enforcement in the society, "says Vikas Vasal, Partner and National Leader-Tax, Grant Thornton India LLP.
How can tax compliance be increased?
Tax experts say that tax awareness in India is low. People are not adequately educated to understand that the taxes they pay will ultimately lead to the development of the nation and therefore contribute to overall well-being. "There are many facilities that the common man needs today and this requires huge investments, tax is a significant part of this and therefore all the taxpayers need to pay regularly," says Chetan Chadak, head of tax research, H & R Block India.
After knowing about how Indian taxation is used, India will pay more taxes, which are already done by the government through various advertisements and awareness programs, but more needs to be done. "People need to be encouraged by non-infiltrators to meet the tax liability and need to take strong action to send a message to any clear case of tax evasion, Vassal says, at the same time, keep in mind that actual taxpayers will not be late in the process. Should
Experts also believe that by providing social security, more and more people will be encouraged to pay taxes because they believe they get compensation. In fact, "Generally in a country where the government can provide a strong social security system, people do not worry about any potential and there is little concern to raise large amounts," says Chandak.
Another aspect that needs to be addressed is that many positive changes have been introduced at the policy level, the ground level experience has been similar and needs to be modified. Superbly, "In the recent past, a number of initiatives have been initiated by the government and the results will be seen on time, including the addition of support for PN, mobile phones, bank accounts etc. Further, with the introduction of GST, we hope that once things get stalled We should see more and more businesses coming under the tax net. Similarly, post remuneration, the number of personal tax increased, "said Vassal Is.
Some tax experts believe that in the last few years the government has taken considerable steps to increase the overall taxpayer base and reduce effective tax rates, there is still a lot to be done in this regard. "By taking some bold action, such as certification, digitization, support implementation, direct benefit transfer, and GST implementation, the current government has proved that it has the desire and enthusiasm to take things at the next level. However, if it is more and more taxpayers in the tax net If you have a desire to bring it, then it will have to focus more on the digital economy, reduce corruption and tax rates (both directly and parochial J) he will bring down, "observes candaka.
Digitization will help the government by breaking tax evasion, increasing revenue and reducing tax rates. In turn, reduction rates can help the government in promoting voluntary compliance by taxpayers, resulting in higher tax evasion.
"It is generally seen that if the rate of tax is brought down, tax compliance increases, and in the Indian context, there is a hope that tax recovery will increase, so that the budget 2018 can be a good opportunity for the government to adopt this path. Vasal says that the tax rate Decrease.
However, will it happen? It remains to be seen.
Whatever the case, tax experts believe that salaried individuals often follow taxation, because the tax on wages income is deducted from the source by the employer. Likewise, the income received by individual taxpayers, such as interest on bank deposits on a particular threshold, is subject to tax registration by banks automatically registered by tax officials.
"The challenge is sometimes wrong in the case of income earned by businesses and businesses. There are various reasons for inadequate compliance, including high rates of taxation, fear of verification and evaluation procedures, in case of time and effort, lots of complaints, including co-operation to satisfy compliance requirements, excessive litigation etc. In addition to the cultural decades, people are not compatible with tax rules Due to the lack of waste and strong enforcement this issue is added. Therefore, we can say that in some cases there is lack of mentality issues and law enforcement in the society, "says Vikas Vasal, Partner and National Leader-Tax, Grant Thornton India LLP.
How can tax compliance be increased?
Tax experts say that tax awareness in India is low. People are not adequately educated to understand that the taxes they pay will ultimately lead to the development of the nation and therefore contribute to overall well-being. "There are many facilities that the common man needs today and this requires huge investments, tax is a significant part of this and therefore all the taxpayers need to pay regularly," says Chetan Chadak, head of tax research, H & R Block India.
After knowing about how Indian taxation is used, India will pay more taxes, which are already done by the government through various advertisements and awareness programs, but more needs to be done. "People need to be encouraged by non-infiltrators to meet the tax liability and need to take strong action to send a message to any clear case of tax evasion, Vassal says, at the same time, keep in mind that actual taxpayers will not be late in the process. Should
Experts also believe that by providing social security, more and more people will be encouraged to pay taxes because they believe they get compensation. In fact, "Generally in a country where the government can provide a strong social security system, people do not worry about any potential and there is little concern to raise large amounts," says Chandak.
Another aspect that needs to be addressed is that many positive changes have been introduced at the policy level, the ground level experience has been similar and needs to be modified. Superbly, "In the recent past, a number of initiatives have been initiated by the government and the results will be seen on time, including the addition of support for PN, mobile phones, bank accounts etc. Further, with the introduction of GST, we hope that once things get stalled We should see more and more businesses coming under the tax net. Similarly, post remuneration, the number of personal tax increased, "said Vassal Is.
Some tax experts believe that in the last few years the government has taken considerable steps to increase the overall taxpayer base and reduce effective tax rates, there is still a lot to be done in this regard. "By taking some bold action, such as certification, digitization, support implementation, direct benefit transfer, and GST implementation, the current government has proved that it has the desire and enthusiasm to take things at the next level. However, if it is more and more taxpayers in the tax net If you have a desire to bring it, then it will have to focus more on the digital economy, reduce corruption and tax rates (both directly and parochial J) he will bring down, "observes candaka.
Digitization will help the government by breaking tax evasion, increasing revenue and reducing tax rates. In turn, reduction rates can help the government in promoting voluntary compliance by taxpayers, resulting in higher tax evasion.
"It is generally seen that if the rate of tax is brought down, tax compliance increases, and in the Indian context, there is a hope that tax recovery will increase, so that the budget 2018 can be a good opportunity for the government to adopt this path. Vasal says that the tax rate Decrease.
However, will it happen? It remains to be seen.
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