Tracing The Indian Tax System: Origins, Structure, And Key Issues
- IJLLR Journal
- Apr 15
- 1 min read
Vanita, Manav Rachna University
ABSTRACT
The present research is intended to critically examine different aspects of the tax system in India. As observed by the author, despite a clear-cut division of powers of taxation between the Centre and the States as per Constitutional provisions, the Indian tax system has been extremely complex due to the existence of multiple taxes, numerous tax compliance rules and provisions, inefficient tax administration and several other issues. In addition to reviewing the available literature on the subject, the present paper attempts to trace the historical evolution of the Indian tax system during three different periods - taxes in ancient India, taxes during British rule, and taxes in independent India. Although the taxation powers of the Union government and the States have been clearly provided in List 1and List 2of the Seventh Schedule of the Constitution of India, these original tax provisions have undergone several changes from time to time through necessary Constitutional Amendments. Attempts have also been made in this research paper to provide a description of direct taxes including Income tax, Corporation tax, Wealth tax, Gift tax, Estate duty, and other taxes on capital and property, and indirect taxes such as Customs duties, Excise duties, Sales tax, Service tax, Value added tax (VAT), and Goods and services tax (GST). In the end, the research paper describes certain critical issues and challenges related to tax reforms in India and also suggests necessary steps that should be taken by the government to streamline the tax system further.
Keywords: Critical issues, Direct taxes, Historical evolution, Indirect taxes, Tax structure.
