Starting income tax data was in the news recently that only 1.2 crore, or 1% of Indians paid income taxes. Tax audit service in Delhi, Check with the tax department revealed that the data was somewhat unrepresentative, as it only considered taxes on salaries. The number of individuals paying taxes is close to 5crore or 4% of the population.
At the same time, the tax department did confirm that the number of individuals claiming to have an income greater that Rs 50 lakh annually is only 150,000 in a country of 120 crore people.
Hence, the tax department’s assertion that there is significant amount of tax evasion in the country may not be incorrect and the so-called hostility with which our tax officials approach taxpayers is somewhat justified. They could argue that if people behaved, they would not have to be so rough.
At the same time, there are constant reports of genuine taxpayers claiming harassment and persecution by tax officials. The tax department many income earners say, starts with the assumption that the taxpayer is in the wrong, deliberately complicates rules, comes after you only because you decided to pay taxes (while ignoring or remaining blissfully unaware of the real tax evaders and doesn’t seem to be getting any better.
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