In the 2019 Union budget, finance minister Nirmala Sitharaman increased tax rates for the super-rich. She is hoping that increasing tax rates would proportionately increase tax revenue. So, an individual’s willingness to pay the tax—tax compliance—is as important or more important a factor in improving tax collections than tax rates themselves. When people are not told where their tax money has gone, their imagination runs wild. This feeling tends to create a further negative attitude towards tax compliance and becomes a valid excuse to resort to tax evasion.

Source: Mint July 17, 2019 10:30 UTC