Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: empanelment :: ACCOUNTING STANDARD :: due date for vat payment :: articles on VAT and GST in India :: VAT RATES :: VAT Audit :: Central Excise rule to resale the machines to a new company :: cpt :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARDS :: form 3cd
 
 
« General »
 What the increase in tax collections does not tell us about Indian economy post demonetisation
 India’s crazy retrospective tax on foreign funds will tarnish country’s reputation
 How tax related, PAN grievances can be resolved through E-Nivaran
 Tackling income tax exemptions for equities and agriculture
 Amfi wants tax benefits for retirement plans
 Top five factors which could chart market direction in the coming week
 Tax rate hikes boost shadow economy
 Tax mop-up may decline in new amnesty scheme
 Weeks before Budget, Finance Minister Arun Jaitley lists out benefit of low tax rates
 Second home loan tax benefits
 Alarm bells over return of tax inspector raj

Salaried Indians pay more income tax than high earners in US, China: survey
February, 26th 2014

It's a known fact that India's salaried class single-handedly contributes to the country's income tax base. But now a new study has found that Indians are among the most taxed in the world.

A survey by accountancy firm PricewaterhouseCoopers (PwC) has found that the take-home salary (after paying income tax rates and social security contributions) of a high earner in India is less than that of salary earners in the UK, Canada, US, China and Russia. (Read the survey here)

In fact, among the G20 countries, only Italy ranked above India when it comes to higher taxes, the survey found. Indians took roughly 55 per cent of their wages home, the survey said. In comparison, earners in Saudi Arabia took 97 per cent of their salary home, while those in Russia took 87 per cent of their wages home, the survey stated.

Individual earners in India are categorized in three groups for taxes -- those earning between Rs. 2 lakh to Rs. 5 lakh fall in the 10 per cent tax bracket, while those earnings between Rs. 5 lakh to Rs. 10 lakh pay 20 per cent taxes currently. However, bulk of the taxes comes from high earners, who have incomes of Rs. 10 lakh and more and are taxed at 30 per cent.

Individuals (42,800 to be precise), whose taxable income exceeds Rs. 1 crore, have to pay a surcharge of 10 per cent from this year. That's not all. Wealthy Indians (wealth exceeding Rs. 30 lakh) are also required to pay wealth tax of 1 per cent.

The skewed tax structure in India can be gauged from the fact that only 4 lakh people account for 63 per cent of tax collected in an economy with a tax-paying base of 3-4 crore people. (Read more)

The government cannot lower rates because income tax forms an important source of revenue for the government. In 2013-14, the government is likely to get Rs. 2.42 lakh crore as income tax (Revised Estimates), which is 21 per cent of total tax revenue estimated for the current fiscal.

The only alternative, then, is to widen the tax net to include many more Indians.
According to Centre for Budget and Governance Accountability, India's tax-GDP ratio at 17.2 per cent in 2012-13 (Budget Estimate) is way below the average tax-GDP ratio for BRICS countries at 22 per cent.

But widening tax base is easier said than done. It involves more aggressive monitoring by tax authorities (the government is already doing this) and taking some tough political decision, such as taxing agricultural income. There could also be a greater debate on abolishing the income tax as espoused by some sections of the main opposition party BJP.

Whatever be the means, rational taxes would not only lead to lower evasion, but also increased productivity.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - We Bring IT. Offshore software outsourcing company. We use Global Delivery Model (GDM) and believe in Follow The Sun principle

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions