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  • Is reducing Income tax a good idea?

    Differential

    Member

    Updated: Oct 26, 2024
    Views: 993
    Recently Govt of India has increased Income tax slabs. Here they are

    For Male Tax Payers
    Upto Rs. 1,60,000 - NIL
    From Rs. 1,60,001 to Rs. 3,00,000 - 10%
    From Rs. 3,00,001 to Rs. 5,00,000 - 20%
    Above Rs 5,00,001 - 30%

    For Female Tax Payers
    Upto Rs. 1,90,000 - NIL
    From Rs. 1,90,001 to Rs. 3,00,000 - 10%
    From Rs. 3,00,001 to Rs. 5,00,000 - 20%
    Above Rs 5,00,001 - 30%

    For Senior citizens Tax Payers
    Upto Rs. 2,40,000 - NIL
    From Rs. 2,40,001 to Rs. 3,00,000 - 10%
    From Rs. 3,00,001 to Rs. 5,00,000 - 20%
    Above Rs 5,00,001 - 30%


    Do you think this is a good idea for a nation's progress? or authorities should focus on country's growth by using the (so called extra) money insted reducing the taxes? or they are trying to ease the inflation?

    What is your take on it? Just say it!
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    Replies
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Replies

  • Rajni Jain

    Member • Aug 13, 2009

    You should have opened this thread around a month back when finance minister announced this. Actually I am saying this as yesterday only minister proposed new tax slabs. According to new proposed slabs (If applicable, applicable from April 2011):

    3 Lakh - 10 Lakh - 10%
    10 Lakh - 30 Lakh - 20%
    30 Lakh and above - 30%

    Tax saving under 80 C is increased upto 3 Lakh.

    What say about these proposed limits??

    -CG
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  • Differential

    Member • Aug 13, 2009

    Yeah, both ways propose same things ! I was talking about why reduce income tax and they have reduced it even more.
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  • Aashish Joshi

    Member • Aug 13, 2009

    Reduction in income tax is not necessarily a bad thing. Reducing the tax increases the amount of money people can spend, which will in turn help the economy grow as people spend more money.
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  • gohm

    Member • Aug 15, 2009

    It totally depends on the system & the current economy. If taxes are lowered in a recessed free market economy, the populous may have more available disposable income however refuse to spend it, thus increasing the recession. If the populous spends that will revive and stimulate the economy. Increased taxes will better government funded programs. This not only can improve quality but also stimulate via trickle down theory. Very vital in a socialized environment.
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  • swapnakumar

    Member • Aug 17, 2009

    yes according to me tax reduction eases our financial status as far this recession is concerned😎
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  • durga ch

    Member • Aug 19, 2009

    I think it worked for good in AUSTRALIA. As soon as recession started, GOV took the intiative to pay back 900$ to the tax payers and tactful enough we recived the payments aroudn easter time, so every oen spent the money off rather than saving it.
    that boosted the economy looks like.
    Australia has missed recession and doing good. I don't tax bonus resulted in no/less recession , but putting money in people's accoutn at right time (both easter time and excalty when recession was taking shape), might have made people not realise the pinch of it.
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  • Ashraf HZ

    Member • Aug 19, 2009

    Well in theory, providing the government isnt in such a bad budget deficit, reducing income would help increase consumer demand (thus help kerb recession).

    But if they'd rather save the money, then it would be a wasted effort.

    Its basically a matter of:
    1. Spending because you have more money (via lower taxes)
    2. Spending because the stuff you need is cheaper (via gov subsidies)
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