look news india
The Income Tax Department is sending reminders to file ITR through email and SMS. Actually, the last date for filing Income Tax Return (ITR) is 31st July. The Income Tax Department is encouraging taxpayers to file returns. There is a facility to file returns with a penalty for not filing the return by the last date. The question is why do you need to pay income tax?
Why is it necessary to pay tax?
In India, filing of income tax returns is mandatory for those whose annual income exceeds the basic exemption limit. Apart from this, the Income Tax Department has also laid down certain conditions, which make it mandatory to file a return. For example, if a person pays an electricity bill of more than Rs 1 lakh in a financial year, then filing a return is necessary, even if the person's annual income is less than the basic exemption limit.
How much exemption is available in income tax?
There are now two systems of income tax in India. Earlier there was only the old system of income tax. The government started the new system in 2020. In this, the tax rates are low, but most of the tax benefits are not available. In the new system, the basic exemption limit is Rs 3 lakh, while in the old system it was Rs 2.5 lakh per annum. This means that it is necessary to pay tax on income above this.
Why does the government collect taxes?
The government collects taxes to get money for essential works. There are many sources of government revenue. Income tax is one of them. The government uses this money for essential works. Apart from spending on health, education and infrastructure, the government also needs money to pay salaries to government employees. Taxes are a major source of government revenue. It includes both direct and indirect taxes.
Which countries do not charge income tax?
In many countries of the world, the government does not collect taxes from its citizens or the tax rates are very low. These include countries like Bahamas, Panama, Cayman Islands. In these countries, the government does not collect taxes from the citizens. Qatar, UAE, Singapore are some of the countries where the income tax rates are very low. Actually, in these countries, the government has other sources of revenue. For example, in the Gulf countries, the government earns a lot from oil. Therefore, the government does not need to impose taxes on its citizens.
Can income tax be abolished in India?
In a country like India, taxation is a compulsion of the government. The main reason for this is that the government has to spend a lot of money every year to provide basic facilities to its citizens, especially the poor. The government gets this money from various sources. Tax is the most important among these. In India, people not only have to pay income tax but also have to pay tax on purchasing most of the things.