By Malvika Gurung
Investing.com -- India’s tax collection is among the highest in the world despite not being the wealthiest nation globally. In the financial year ended March 2023, the country’s gross direct tax collection witnessed a growth of over 20% at Rs 19.68 lakh crore.
Renowned economist Surjit Bhalla believes that it is necessary to bring down the current income tax rate of approximately 40% to not more than 25% in order to accelerate the country’s economic growth.
He notes that India’s tax collection size is among the highest in the world, with the Centre, state and local bodies collecting taxes amounting to nearly 19% of India’s GDP.
Bhalla proposes a reduction of 2 percentage points in this figure, suggesting that the overall tax rate should not exceed 25%, especially for direct taxes.
In Budget 2023, the Government reduced India's highest income tax rate to 39% from 42.74%, by reducing the surcharge applicable to high net-worth individuals. Bhalla states that the tax cuts should benefit all individuals and not just a select few in society, a PTI report cited.
On the issue of tax evasion, the economist said, “You cannot minimise tax evasion without doing something about very very high rates of income taxation. We need to change the tax structure so that everyone benefits rather than some selected sectors.”
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Bjp is money sucking worm! They will always be loking for opportunities to tax common man.Like 3