About India Tax
This country has got a well structured and simplified taxation system, wherein an authoritative segregation has been done among the Central Government, the different State Governments as well as the Local Bodies. The Department of Revenue under the Government of India's Ministry of Finance is solely responsible for the computation of tax. This department levy taxes on individuals or organisations for income, customs duties, service tax and central excise. However, the agriculture based income taxes are levied by the respective State Governments. Local bodies have got the power to compute and levy taxes on properties and other utility services like drainage, water supply and many others. The past 15 years have witnessed tremendous reformations of the taxation system in India. Apart from the rationalization of the rates of tax, simplification of the different laws of taxation has even been done during this period. However, the process of tax rationalization is still in progress in the Republic of India.
Types of Tax
There are different kinds of taxes, which are prevalent in the nation. The computation of those taxes varies from one tax to another, depending on the nature of a particular tax. Following are some of the major taxes in India:
Capital Gains Tax:
Payable on the capital gains that are received after the asset sales, this tax is a direct tax levied by the Central Government of India.
Levied by the India Government, this type of direct tax involves the payment of tax by the companies based within the Indian Republic on their worldwide income.
This tax is computed on some specific services, which are provided in the country. The tax is levied at 10 % rate with an additional education cess at the rate of 2 %.
Governed as per the Customs Act, 1962 as well as the Customs Tariff Act, 1975, the imported goods in this nation attract basic and additional custom duty.
Excise Duty:According to 1944's Central Excise Act and 1985's Central Excise Tariff Act, this duty is levied on the manufacturing of goods.
Personal Income Tax:This tax in the Indian Republic includes every kind of income, which is computed and levied by the Union Government. The income from agriculture is not levied or collected by the India Government though.
Value Added Tax:Value Added Tax or V. A. T. has been implemented in most of the states in place of the Sales Tax from 1st April, 2005. Such a tax is levied while selling movable goods.
Wealth Tax:Applicable on all the Indian citizens, this tax is levied as per the Wealth Tax Act, 1957.
Apart from the ones mentioned above, there are many other taxes, names of some of which are as follows. Among them, some taxes are even solely levied by the State Governments or Local Bodies:
- Asset Transfer Tax or Stamp Duty
- Building Tax or Property Tax
- Dividend Tax
- Entry Tax or Octroi Tax
- Fringe Benefit Tax
- Fuel Tax
- Poll Tax
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