What’s happening?
The man behind Income Tax in India was James Wilson “A Scotsman in India”. He was a self-taught economist with a deep understanding of how the market worked. Founder of the global giant Standard Chartered Bank, he also started the business magazine “The Economist.”
The Inception… The Income Tax Act was introduced in the year 1860 by James Wilson. After initial resentment the safe and secure environment the British provided to trade justified the tax they levied.
Money is the sinew of War… The Sepoy Mutiny, Indias’ First War of Independence & World War II had drained the British coffers, resulting in huge debts. Someone had to step up & salvage the Crown.
The Dire Need For Tax… Failing to see the irony – the East India Company first divided the country and then demanded tax in exchange for security. However, the Scotsman said that “colonies would just be as valuable to us… if they were independent”
Aversion To Pay Taxes… A strong aversion towards taxes was understandable during colonial eras. This policy severely impacted businesses, zamindars, and feudal lords.
A Valued Tool… Income Tax Act has persisted even after 70 years of Independence and has proven a valuable financial governance tool ever since.
Alas, we have James Wilson to thank!!!
The government prefers FIIs over HNIs… Income from Trading for FIIs will now be classified as Capital Gains. Surely, this announcement by the FinMin left the HNIs and promoters sulking. In the Government’s defense, it could rally foreign investors and improve Fiscal deficit.
Notices are given out like candies… Except candies make people happy. Thousands of companies have received notices from the Central Board of In-direct Tax for wrongly claiming credit under the GST framework. Several of these companies are from Maharashtra, New Delhi, West Bengal, and Tamil Nadu. They can either pay off the amount or challenge in court.
Is Vivaad se Vishvas as good as it sounds… Anurag Thakur has promised that 90% of the tax disputes will be solved through the ‘Vivaad se Vishwas’ scheme. Thakur has also asked the officials at ITD and Central Goods and Services Tax departments to not harass any entrepreneur…. Way to go Start-up India!!
“In the last five years…Over three crore Indians went abroad for business or tourism… only 1.5 crore paid Income Tax”
-CBDT (Central Board of Direct Taxes)
