In 1925, the Indian taxation enquiry committee noted, “There is no historical or theoretical justification for the continued exemption from the income tax of income derived from agriculture. NITI Aayog member Bibek Debroy’s suggestion last week that agricultural income above a certain threshold should be taxed is a case in point. Yoginder K. Alagh’s 1961 analysis of agricultural tax yields, Case For An Agricultural Income Tax, in The Economic Weekly—now The Economic And Political Weekly—is illuminating, showing a substantial rise in revenue over the previous decade, vital for a young nation state. In assessment year 2014-15, for instance, nine of the top 10 claimants for tax exemption of agricultural income were corporations; the 10th was a state government department. Given the extent of the informality that still exists in the agricultural sector, implementation of an agricultural tax would admittedly not be easy.

Source: Mint May 03, 2017 21:22 UTC