Who opposes tax reform?
The rich oppose tax reform, since exemptions are best harnessed by them. Accountants, tax consultants and lawyers oppose tax reform, since their revenues depend on a complicated exemption-ridden tax system. Income tax How much money is collected through income tax? In 2003-04, the Government collected Rs 40,269 crore in income tax. What lies next in income tax reforms? The first issue lies in removing exemptions. We should move towards a simple income tax system, probably with three slabs, where income below Rs 1 lakh is exempt; from Rs 1 lakh to Rs 3 lakh is taxed at 20 per cent; from Rs 3 lakh to Rs 10 lakh is taxed at 25 per cent; and incomes above Rs 10 lakh are taxed at 30 per cent. The second issue is the need to abolish income tax on companies. The principle here is that only individuals should pay income tax, and all forms of organisationsclubs or associations or companiesshould not be penalised by suffering a second layer of taxation. Whether individuals set up companies or cl
