Bobby Said:
Well, Income Tax may be considered to be charged at a single flat rate of 10 per cent on total Gross Income as TDS just like a Service Tax only, the minimum.
However, for middle class/poor people, this 10 per cent Income Tax on total gross income may be borne by Employer and Employee in the following ratio:
Gross Income Employer : Employee
upto 50,000 Borne by Employer-Full
50,000 to 1 lac 3 : 1
lac to 1.5 lacs 2 : 2
1.5 lacs to 2 lacs 1 : 3
More than 2 lacs Bonre by Employee-Full
There may be lot of retaliation/dissentment from the lower income groups for paying single 10% Income Tax on Gross Total Income. For them, Government may consider reduced/lower single slab Income Tax with 2 per cent, 4 per cent, 6 per cent and 8 per cent on Total Gross Income upto Rs.50,000, Rs.1,00,000, Rs.1,50,000, Rs.2,00,000 respectively.
Incomes from (i) Interest (ii) Dividends (iii) Short / Long Capital Gain (iv) House Property may be considered to be charged at a single flat rate of 10 per cent as TDS just like a Service Tax. However, people below the poverty line may be given exemption of this 10 per cent Tax on Interest.
Wealth Tax may be considered to be abolished.
STT may be considered to be allowed to be continued and may not be considered to abolish the same.
When all the incomes are charged at a single flat rate of 10 per cent, then ultimately, the revenue from Income Tax shall definitely be manifold. Then there are chances of less Tax evasion, less burden of filing returns.
All Tax Saving Investment Schemes may be considered to be abolished.
People shall have the option either to invest the savings or purchase some more things out of the savings.
In both the cases, the Government will earn revenue either in the form of Tax on interests/Dividends or Tax on Excise/Sales Tax.
You are requested to consider on the above points for a single flat rate of 10 per cent Tax on Total Gross Income.
with regards
Bobby
Posted On 8/18/2009 2:45:12 PM