Since the dawn of time, all citizens of the country have paid taxes. People have taken various steps to prevent it, but they continue to fall victim to the income tax laws. Special laws have been enacted for taxpayers and non-taxpayers. Have you ever began to wonder how it all started?
1860 was a memorable year. The British imposed an income tax as a temporary solution to the problems that arose during the 1857 revolt. From 1860 to 1886, approximately 23 acts were passed in the direct tax system as an experiment. In 1860, the tax was levied at 2% on income between Rs. 200 and Rs.500, and at 4% on income above Rs.500. People earning less than Rs.200 per year from all sources (including agriculture income) were exempt from paying taxes. Cultivators paying less than Rs. 600 in rent, as well as religious and charitable institutions, were exempt from paying the tax.
India is among the countries with the highest tax burdens. It has a three-tiered federal tax structure. This structure is made up of the central government, state governments, and local municipal bodies. "No tax shall be levied or collected except by the authority of law," states Article 256 of the constitution.
The Government Imposes Two Types Of Taxes:
- Direct Taxation:
It is imposed directly on individuals and corporations.
- Indirect Taxation:
These are taxes that are levied on the public indirectly through goods and services.
There are five major income tax categories.
- Earnings from Salary:
The earnings are taxed as head salaries.
- House Property Income:
It is the tax on leasing revenue derived from the house of property.
- Revenue and Increases from Profession or Business:
Any income earned from trade/commerce/manufacture/profession is taxable.
- Capital Gains:
Any profit or gain realized from the transfer of capital assets during the fiscal year is compensable.
- Other Sources Of Income:
This category includes interest income from bank deposits, lottery prizes, card games, gambling, and other sports awards.
GST (New Tax): The GST concept was proposed in 2000, and the law took 17 years to evolve. The goods and services tax (GST) is a combined tax that has replaced indirect taxes. The tax will be collected at all points of sale. GST is also primarily driven by technology. All activities, such as filing registration returns, applying for refunds, and responding to notices, must be completed online through the GST Portal.
The tax industry offers numerous career opportunities. The salary for a fresher tax consultant job can start around Rs. 25,000 per month and can rise depending on education and experience. The more experience you gain, the higher your monthly salary will be. The introduction of GST certification has also resulted in an increase in job opportunities in the sector, transforming it into a professional course.