Here you don't have to pay any tax even if you earn crores – News India Live

Tax Free States of India: Nowadays there is a lot of discussion about whether the deadline of July 31 will be extended or not. The government has rejected the speculations going on in the market whether this deadline will be extended by a month or not. The last date for filing Income Tax Return (ITR) is 31 July. Every person falling under the purview of income tax has to pay income tax and this return has to be filed under the Income Tax Act 1916, but do you know that there is a state in India where it is not necessary to pay tax.

Yes, even in a country like India, there is a state where people do not have to pay tax. People living in this state do not have to pay a single rupee because they live in a tax-free state. This state does not come under the Income Tax Act. The biggest question is why is this happening? So let's know the answer in detail.

Tax is zero even on income of crores:

Sikkim is the only state in India where people do not have to pay tax. Here people earn lakhs or crores of rupees annually but they are exempted from paying tax. The question is why such a big relief has been given to the people of Sikkim in terms of income tax? Sikkim merged with India in 1975. At this time the condition was put that they want to adopt the old law. To maintain the special status of the state, Sikkim refused to adopt Section 1916 of the Income Tax Act. This condition was also accepted by the Government of India due to which Sikkim is a tax free state under Section 10 (26AAA) of the Income Tax Act 1961. According to Article 372 (F) of the Constitution of India, income tax exemption is given.

What is the rule under Section 10 (26AAA)?

Residents of Sikkim are not included in the scope of income tax under section 10 (26AAA). Residents of Sikkim before its merger with India are exempted from tax under section 10 (26AAA). Income from interest or dividend from any type of security is tax free. It is important that every resident, whether he is in the register of Sikkim Subjects Regulations, 1961 or not, is exempted under section 10 (26AAA) of the Income Tax Act.