Govt. to remove income tax exemptions and deductions. Please comment against it.....

[satish_appasani]

Source : http://incometaxindia.gov.in/
In its commitment to simplify the tax laws, minimize the distortions within the tax structure and broaden the tax base, the Government is reviewing various exemptions and deductions under the Income Tax Act, 1961. The Government is keen to involve all stakeholders in this exercise. Accordingly, the comments regarding removal or continuance of exemptions and deductions are sought from general public by 05-July-2006.

It's a shame that Govt. wants to put a cut on the exepmtions and deductions on Income tax offered to citizens. Being the main source of IT, the govts. always target the salaried people to squeeze more taxes instead of collecting taxes from tax evaders. First reservations and then this... Can't understand what govt. is up to.....

Please send your comments to the govt opposing this change. More info here:
http://www.incometaxindia.gov.in/arc....T.Act1961.doc

[satish_appasani]

To add more info how it's going to affect us:

It is heard that Congress government is planning to scrap tax exemptions on various policies like LIC, NSC, HRA, Mutual Funds & Other section 80C benefits (Exemptions Upto 1 lakh).

What does that mean:
- You cannot get tax exemtions on your HRA, i.e. No business of showing House rent agreement & receipts. You will be taxed on the whole HRA.
- You cannot claim tax exemptions by showing LIC Polocies or by having NSC Bonds.
- You wouldnt' be able to get tax exemtions on Housing loans.
- No Tax benefits on Mutual/Infrastructure bonds.

What does government wants:
Government is targeting the salaried people and is making sure that no tax exemptions can be availed and thereby collecting as much tax as possible from our salaries.

[supremeBaleno]

@satish, the salaried class is like a goose that lays golden eggs. They will get the most out of us as it is easy. Also, we do not contribute to their party funds and are not seen as a vote base. Reasons enough for them to target us.

[ksethuram]

Squeezing the salaried class is easy as they are decent people.

I am sure that the political parties will never allow India to improve. We lag in many areas.

1) Implementation of nationality number (This will stop all mal practices and crime). They are not doing this bcz their people will be caught.

2) Infrastructure- Only utilizing <10% of the collected road tax amount to roads(Rest goes in providing subsidy which counts to vote bank).

3) Usage of Tax payer's money in wrong way's - Providing Free Power and TV's (Really a shame to be a resident of Tamilnadu), Free Land....just for votes. I don't know what court and election comission is doing?????

4) Only targeting the salaried class for tax. (I pay 30% of my earnings as tax. Isn't it too much??. Note: This is one of the highest in the world). I am sure that more than 50% of the money we pay as tax goes into the mouth of politicians in various means.

[prakash2757]

I dont know what this govt up to. They gona losr a big time.

1st thing they played with future of students with all Quota crap. now with this.. Do they know how many people are working in India ? If they gona do this then do Congress think they gona come back in power ?

[vivekiny2k]

for a change i support it,

i am an honest tax payer, and i don't like seeing ppl givin false bills for rent and medical, to`get zero tax liability, while i pay in multiples of 6 digits.

i really felt stupid, trust me, when i was told i am not smart enough to use the loopholes.

[sharathjeppu]

Hey I support it too!

As long as my total tax outgo does not change, I will completely support removal of all these exemptions as they make tax calculations a lot simpler and give me more freedom on what I would like to do with my money.

All these tax exemptions essentially provide loopholes to avoid tax.

Having said that, I think the govt. should target the non-salaried people for widening the tax net. A friend of mine who is salaried and whose husband is a businessman earning close to 10 times of what she does was once remarking to me that they had to apply for a home loan by quoting her income as her husbands stated income was far below hers!!

Another friend of mine had remarked to me how his businessmen friends are shocked at the amount of income tax he pays though they earn much more than him.

[zenx]

Yeah the tax structure has been getting rationalized. You pay zero tax on long term equities etc. They should probably not u insurance and other 'returement fund' like returns, but overall it'll help achieve simplification.
More of us Indians need to start paying taxes.

[naveendhyani]

Folks, here's your chance to have a say in the tax policies of the government. The FM wants your inputs before doing away with the tax breaks that you have been enjoying for so long. The Finance Ministry in its website has asked all stakeholders to post their comments by July 5, ‘06. Big ticket direct tax exemptions like housing loans, tax concession on PPF and LIC and scholarships for education, backward area concessions for industry, long term capital gains and concessions for agricultural income have been put on notice by the government, for eventual phase out. So if you have a view on whether to continue with or do away with a tax break, here's your chance to voice your opinion.

A list of 162 exemptions and deductions have also been put up for public comments by the Central Board of Direct Taxes for being erased from the Income Tax Act.

So, Indians and NRIs, if you want the FM to listen to you, put in your suggestions on tax waiver.

http://o3.indiatimes.com/et_blog/arc...x?Pending=true

[Technocrat]

In some news channel they were showing that even the saral form will no more be saral(easy) we will need to give detail of our expenditure in the new form, the news channel went to the extent that we will need to give details of bills for our daily ration also, I am like *** we dont have any black money every thing is white so does it matter to govt how we spend it ???

[naveendhyani]

IMHO ny politicians grace if this goes thru, lets collectively detest from filing ny returns.

*** so far in our 50 "golden" years of indepence how many netas have got prosecuted?

and then when the court comes down 2 getting the law implemented (as in MCD demolition drive in delhi) the laws are twisted again. what a shame.

rapists, robbers, extortionists are goin to the parliament is the EC is just a sitting duck. quack once in a while just 2 make ur presence or should i say existence felt.

[supremeBaleno]

Guys, I have had this doubt for a long time. Do our corrupt politicians pay Income Tax on their salary, allowances and perks like we do on our salary ?
Anyone has any clue ? Or did they just pass a resolution (unanimously, ofcourse) to not have tax for their income ?

[naveendhyani]

BTW i spoke 2 a lawyer friend of mine who told me our very own FM is a lawyer by profession who charges nywhere between 2-5 lacs per hearing. mind u this is not for the whole case but for each hearing.

do u think he will b paying the tax on this????

if today we were 2 prepare a report as to what the net worth of our netas today compared to their early days, i think there wud b more than 95% who have gained astronomical amounts following their stints as ministers.

none of them do ny social service rather they keep asking for votes 2 make the people's life better. u dont see ur elected people until its election time, cause they r busy "forming policy" (who cud not clear their 10th exam) and minting money.

[epyupc]

Originally Posted by naveendhyani

BTW i spoke 2 a lawyer friend of mine who told me our very own FM is a lawyer by profession who charges nywhere between 2-5 lacs per hearing. mind u this is not for the whole case but for each hearing.

do u think he will b paying the tax on this????

YES. We have often used the counsel of his wife, Mrs Nalini Chidambaram, and everything is always above board. TDS was not shirked in any way.

I'm generally not one who thinks highly about politicans, but I think the PM and FM are not corrupt in the material sense. That does not mean I don't agree with their policies though...

[vivekiny2k]

Originally Posted by epyupc

YES. We have often used the counsel of his wife, Mrs Nalini Chidambaram, and everything is always above board. TDS was not shirked in any way.

I'm generally not one who thinks highly about politicans, but I think the PM and FM are not corrupt in the material sense. That does not mean I don't agree with their policies though...

glad to hear that. but we are worrind about the whole system here. even IF he is fair in his practices, he will be thrown out the moment he tries to expand his net to other supporting netas.