We had a session on tax planning today @ our office. One of the renowned charted accounts of mangalore had come down to take this session. The room was house full. The session gave us some info on what are the different aspects of the income tax.
Learnt a very weird fact about the income tax in India. The income tax act or the bill is valid for only 1 year, and its presented every year in the parliament since its inception!. If its not presented, then the government has to come out with some notification about it. Else, the income tax is not levied for that year!. But that has never happened. But I guess its wired.
But the situation is very bad. The employed class account to around 85% of the tax payees!…. That’s a very disproportionate figure. And the worst part is, not more then 5% of the population pays tax. So, just imagine the situation. Not fair. And, if one is employed, then there is just no easy means to evade the tax net. Or in other way, if you are employed, then now way to avoid tax. You can save some tax say, around 20K, but, then you will have to invest heavily! around 150K!!………..appx 7.5 times for long periods! But, on the other hand, if you are into business, there are quite a lot of loopholes… or, its very difficult for the income tax dept to actually track things.
I really don’t mind paying taxes, provided they are used for the right purpose and in the right manner. Right now, I guess, only 1% of the tax that I pay actually goes for the right purpose.
One more fact that I learnt from today’s session is, under some section of the income tax act (80g or something), donations to political parties is fully exempted from tax !!.. Wow!…… that’s great. Hehehe. God save us.