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Just saw prime time on NDTV where a penal of economic and tax expertise debating on the BABA RAMDEV’S idea of abolishing the current tax structure and introducing the new tax the BANKING TRANSACTION TAX. As usually very quickly I find myself in eager situation where I have to give some focus on this issue. After some time spending on WIKI and GOOGLE I write down these points which help me to understand the tax structure in India. >>> there are three topics in which we can include all the taxes levied in India……


1st- PROGRESIV TAXATION: In this as income increase the tax also increases, the income tax in India is the example of this. Those in favour of this they say that this is good for equality in social but on the other hand critics criticize this by saying that by this the rich men can hide their income for evasion of tax.Taxation-Structure-it’s-Impact-on-small-businesses-compressed

2nd- REGRESIV TAXATION: In this lesser income people have to give more tax than rich peoples. For example one men have ₹1000 income and he give ₹100 as VAT on purchase of item so as this he gives 10% of his money on indirect tax, from another perspective if men have ₹500 income and he give ₹100 as VAT on same item so now he gives ₹20% of his income as indirect tax. by this example we can say that regressive taxation is not follow the rule of equality.

3rd- FLAT or PROPORTIONAL TAXATION: in this a flat rate of tax is impose on amount ignoring the amount, it can be similar as regressive taxation.