Do u feel that Personal Income tax is liable for double Taxation ?

Question

Do you know that people pay tax so many times against their income? Can u list them.
When we spend we pay in the shape of excise, custome,octroi,sales tax, VAT , Service tax, Educational cess, Higher Education Cess, Surcharge, TDS so on and so forth. Do you agree with me ?

Answer 1

Dear Mr.Somani CA

I too thought in this way and tried to find a solution and posted my question in yahoo answers.
Please see the question is pasted below, please let me know your comments on this.
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I need your comments please ! I have a 8 point programme for a Corruptionless India?

1. Every citizen should be provided with a permanant account number
2. Cash transactions should be discouraged by printing money upto the denomination of Rs.100.00 only
3. All transactions above Rs.1000/- to be made through banks with dr/cr card, funds transfer, chq/dd or online payments.
4. All taxes (IT,ST,cess,ED,service tax etc.,) should be dropped. Only transaction tax of 1% on each bank transaction let it be debit or credit to be levied and automatically transferred to treasury a/c. (I think this will be sufficient to replace all the taxes)
5. Banks should maintain one a/c and give uniform interest.
6. If all taxes are dropped, somuch of paper work and filing of returns, maintainance,inspecting and scrutinising will vanish & the people used for this purpose can be utilised to do for more productivily
7. If cash transactions are discouraged, then corruption,black money etc. will fall to nil.
8. budget only for proper expenditure and need not worry abt income.
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Answer 2

Technically, the 999 plan would be double taxation (actually triple if you include corporate tax that gets passed on to the consumer), but that is no different than it is now, it is just flat instead of progressive. Really, you can't avoid that...but a bad double tax in my opinion would be the death tax, or paying tax on a used item, because in both those cases, all three of the above taxes have already been paid.

Answer 3

Mr. Somani,
In one respect your thinking is right but it is not constitutionally valid. As per constitution it is valid. Now, let me explain how
Income Tax - This you pay on income earned by you
VAT - This you pay on purchase/consumption of goods etc.
E-Duty - Indirectly on production of goods
and so on and so forth.

If only one tax is to be paid then how the government will function and where from the funds shall come?

Will agree with me that after paying all taxes still there is savings and your bank balance or investment increases although tax following addition taxes are payable at any of time through whatever mode

Cess, Octroi, Road Tax, CST, Property Tax, Entertainment Tax, Expenditure Tax, Service Tax, Water Tax, Airport tax, Toll Tax, Gunda Tax, Hafta, Police Tax, Security Transaction Tax, Turnover Tax etc. etc.

Answer 4

No, I don't feel that it is double taxation. On the contrary it is multiple confusing taxation. But all it is allowed as per Constitution. Still some times it is necessary. Local Bodies need their share for taxation, State Governments need their share in taxation and of course Central Government also needs funds which are partly generated through taxation. The Governments find out various ways and are always chasing new avenues to increase ways to generate revenues. It results in multiple taxation. Unfortunately, every body needs separate collection system. They do not feel it necessary to centralise or simplify the procedures. That's more irritating. It can be understood that only one or only taxes will not suffice but multiplicity on various counts should be avoided. We have experienced that reduction in rates or taxation generated more revenues. The same logic should be applied to reduce the number of taxing avenues. It will lead to less corruption, more compliance and morality.

Answer 5

ya, you felt absolutely right. we have to pay tax so many time with our income tax. ie. excise, vat, sales tax, service tax. because all taxes which are indirect have to pay by customer . besides it we have to pay our personal income tax on our income. and second thing is that we can't take deduction of all above indirect taxes. you thought right. i am with you in this thinking...

Answer 6

yes u r right we do pay taxes at many point.
but ARE u saying something new which every one else does not know about.
what is ur point
do u just want to dazzle others with ur so called knowledge ????

Answer 7

Wait until Hillary gets in. What you have listed will double, with more categories being added on, on top of it.

Answer 8

yes

Answer 9

yes

Answer 10

old information every one know it write something new