When was the first law for tax introduced in India?
The modern income tax system was first implemented in india by the british in 1860. Before this, there was no law in the country. james Wilson, the first Finance minister of the british Indian Government, prepared the country's first budget. Income Tax Act was brought in this budget. Actually, the british had suffered a lot in the revolution of 1857. Then, to compensate for this loss, the british made an income tax law. But since then many amendments and improvements have been made to it.
After the First World war, a new Income Tax Act was passed in 1918 to compensate for the war losses. This Act remained in force till 1922 which was later replaced by another Act.
The Income Tax Act was amended 40 years after india got independence from the british and again 15 years later in 1961. The present Income Tax Act was adopted in 1961 and came into force on 1 april 1962. A special feature of India's Income Tax Act is that there is no tax on agricultural income.
India's tax system is considered one of the most complex systems in the world. Many types of taxes are included in this. Like: Income Tax, Property Tax, gift Tax, Sales Tax, Customs Duty, GST, and corporate Tax.
Why is the tax system necessary?
The strength of the economy of any country depends on how good its tax system is. A fair tax system can accelerate the economic development of the country and pave the way for its progress. A good tax policy helps in the development of the country's GDP.
