Indian Tax Structure
Tax Structure present in India is very strong and follows the financial year.
The taxation is applicable for any kind of income pertaining to any person working as an employee any where in India at any level.
Tax is a compulsory payment by a person to the Government.
Direct taxes are those which are imposed on a person either on his income or wealth and the tax liability cannot be escaped. It is governed by Central Board of Direct Taxes (CBDT).
Indirect tax is collected by middle men in the channels of distribution of goods and it is remitted to the Government treasury.It is governed by Central Board of Excise and Customs (CBEC).
To enable smooth functioning of the taxation system, 3 lists have been put forward in Article 246 of the Indian Constitution.
- List I mentions the areas where only the Parliament can make laws
- List II mentions the areas where only the State Legislature can make laws
- List III mentions the areas where both the Parliament and the State Legislation can make laws
Different heads of income under tax structure in India:
- House property
- Profit in business or profession
- Capital gains by sale of immovable assets
- Other sources