Recent Individual Income briefly described.

Given the existence of

many revenue sources as also government
expenditure, the redistributive impact of

Tax Reform the budget as a whole is of importance.

Reduced redistributive impact or progres-
sivity of individual taxes is of limited
relevance and may in fact be desirable on
An attempt is made here to evaluate recent reform of the efficiency grounds. Instead, since the
non-corporate tax structure by examining its current base, the primary purpose of broad based taxes is to
raise revenue, revenue productivity, mini-
rate structure, selected administration reforms and likely mal efficiency and growth costs, and
implications of these reforms for compliance costs and compliance. horizontal equity (equal treatment of
There are four main conclusions. Tax base reforms have equals) are key objectives.1 For the in-
increased the differential treatment of income from different come tax in developed countries, equity
sources. Nevertheless reforms stop short of steps needed to fully is best served by a global income tax
which adds together income from all
capture offsetting benefits from reduced compliance costs and sources without differential treatment.
increased tax compliance. Second, the restructured tax rates are Moderate rates with few use-based con-
the most liberal since the 1960s, except marginally for individual cessions minimise allocative distortions
taxpayers close to the exemption limit. Third, however, reforms are and make the tax a potentially buoyant
likely to increase individual compliance costs as a percentage to revenue source. Concessions should be
limited mainly to those required to com-
taxes collected. Fourth, compliance and so the revenue impact of pensate for differences in ability-to-pay
recent reforms is likely to have been positive though moderate. among those with equal incomes, such as
for medical expenses.2 On the other hand,
ARINDAM DAS-GUPTA Non-Manual Employees (CPIUNME), in those developing countries where non-
(ii) non-agricultural GDP at current compliance and high compliance costs

T
he 2005 Union Budget has intro-
duced a number of changes in the
base and increased the rate slabs of
the non-corporate income tax. The initial
motivation for this article was a desire to
answer the question “how low are indi-
vidual income tax rates now as compared
to rates in the past, when inflation is taken
account of ”? However, the general rates of
non-corporate income tax are not appli-
cable to all types of income and, further-
more, fragmentation of the income tax
base has been a continuing process espe-
cially during the past three years after the
release of the Report of the (Vijay Kelkar)
Task Force on Direct Taxes (2002). So to
put rate evolution in perspective, it is
necessary to first answer a second question:
“What base do these tax rates apply to and
how has the base been evolving?”. In the
analysis here an attempt is made to describe
and evaluate tax simplification resulting
from these changes against a normative
benchmark. To round out this evaluation
of the non-corporate income tax, the
likely compliance cost and compliance
impact of recent reforms in the tax struc-
ture and its administration are examined.
The article closes with a few additional
reform suggestions. In the data appendix
individual income tax rates from 1965-66
onward are documented (Tables A1 to A4).
The other time series used for analysis
are (i) Consumer Price Index for Urban
prices, (iii) per capita NNP and
(iv) individual income tax assessees. Data
for the first three series are from the
Economic Survey and the fourth from
reports of the CAG.
The four main conclusions reached
are that: (a) Tax base reforms have in-
creased the differential treatment of
income from different sources, causing a
further decrease in horizontal equity.
Nevertheless, since these reforms stop
short of full schedular treatment, whereby
different income sources are taxed inde-
pendently, offsetting benefits in terms of
reduced compliance costs and increased
tax compliance are not fully captured.
(b) The restructured tax rates (inclusive of
Union surcharge, education cess, and
general rebates) are the most liberal
since the 1960s, except for individual
taxpayers close to the exemption limit.
This implies a major reduction in the
potential progressivity of the income tax,
a welcome step. (c) These reforms when
combined with major tax administration
reforms that are under way are, however,
likely to increase individual compliance
costs as a percentage to taxes collected.
(d) The compliance and so revenue impact
of recent reforms is likely to have been
positive though there is scope for further
improvement.
To evaluate the tax base and tax rate
reforms, normative design benchmarks are
loom large, a schedular tax with extensive
tax withholding (tax deduction at source
or TDS in Indian usage) is increasingly
seen as the best way to preserve the
revenue productivity of the income tax, at
the cost of horizontal equity.3 Low rates
are still important, an additional reason
now being to ensure some equity between
tax evaders and honest taxpayers. Non-
compliance and high compliance costs
are likely to be the major sources of lim-
ited revenue productivity and horizontal
inequity.
As has been pointed out, the income
distribution impact of the tax is not ex-
amined here. To put the discussion in
perspective, it is important to bear in mind
that the individual income tax in India is
a tax on the relatively rich, affecting less
than 20 per cent of India’s population.4
It has no direct impact on the poor. A
second limitation is that allocative effi-
ciency and growth effects are not ad-
equately examined. To properly evaluate
these effects in relation to a given tax,
general equilibrium analysis incorporat-
ing all major taxes and non-tax instru-
ments along with prevailing market
characteristics is needed. This is much
beyond the limited scope of this article.
It should be borne in mind that comments
here about the distortionary impact of
differential treatment of various
income sources are partial, ignoring

Economic and Political Weekly April 2, 2005 1397

 Table 1: Income Tax Treatment of Income of Resident Individuals
Measure Likely Impact on Equity, Compliance Costs and Compliance

General: Income from all sources, except as specified below, is clubbed together and, after netting out losses, taxed according to the prescribed tax schedule.
Income from salaries Likely impact on equity, compliance costs and compliance
1 Abolition of standard deduction earlier provided in lieu of itemised deductions of
expenses made to earn income

2 17 specified categories of fringe benefits not directly attributable to employees to be 1 (a) Taxation of gross salary receipts rather than salary income.
taxed in the hands of employers at the maximum marginal income tax rate/corporation
tax rate (30 per cent) (b) ‘Compensation’ for salaries which are less evasion prone than
other income sources no longer available.
2 (a) Broader base bringing hard-to-tax income into the tax net and
raising revenue productivity.
(b) Continuation of existing partial exemption of house rent allowance,
leave salary, leave travel concession.
(c) To the extent that fringe benefits go to individuals with cash
salary above the threshold of the highest marginal tax slab,
horizontal equity improves.
(d) Inclusion of “contributions by employers to approved superannuation
funds” may result in indirect taxation of employees with income
below the exemption limit or in low marginal tax slabs.
(e) Increased compliance cost, particularly for local bodies and
other entities exempt from income tax.6
(f) Should lead to partial substitution from fringe benefits to cash
especially for employees whose marginal income tax rate is
below 30 per cent.
Income from house property: No recent changes.
One self-occupied house is exempt.
Standard deduction of 30 per cent of ‘net annual value’ is available regardless of actual expenses.
Interest on housing loans/borrowed capital is deductible up to Rs 1.5 lakh against income from any
source except long-term capital gains.
Business and professional income: Business income is the same as profit except that some business expenses, including depreciation, can be deducted from
business receipts only up to a presumptive limit. Also, some minor businesses (e g, truck owners) are taxed presumptively.

3 Reduction in the general depreciation rate for plant and machinery from 25 per cent to 3 Partially offsets tax reduction from higher exemption limit and tax
15 per cent. Also some reduction in other depreciation rates. slab thresholds.7 Relative increase in discrimination against existing
manufacturing and other capital intensive activities in favour of
services.
4 Increase in the depreciation rate for new plant and machinery from 15 per cent to 20 per 4 Relative increase in attractiveness of new investment.8
cent and removal of the 10 per cent expansion floor for eligibility.
5 Securities transactions tax (introduced in 2004) paid not allowed as a business 5 Offset in some cases by exemption of capital gains. Otherwise
expense results in double taxation introducing or increasing lock-in.
Capital gains: Pre-reform treatment:
Financial and non-financial assets have different qualifying periods (1 and 3 years respectively) for long-term gains treatment.
Restricted tax deductible reinvestment channels for long term gains exist.
Long term gain computed as sale consideration less ‘indexed cost of acquisition’ (referred to below as the ‘old method’). Normal tax rates applicable after
clubbing with other income.
6 and 7 (a) Near complete schedular treatment of capital gains with
6 Instead of being added to other income, short term gains from assets subject to relatively low tax rates but limited access to channels to further
securities transactions tax made taxable at 10 per cent in 2004-05. Certain deductions reduce tax liability available to other income sources.
and saving based rebates available to other income not permitted. (b) Exemption limit and general income tax rates only applicable to
7 Since 2004, long term financial gain computed under the old method is subject to 20 per some types of gains.
cent tax. An option has been given to deduct actual rather than indexed cost from sale (c) Distortionary potential across types of assets from the combined
receipts and pay tax at 10 per cent. Various tax rebates available to other income are impact of capital gains tax, securities transactions tax and
not permitted. unreformed reinvestment provisions.
(d) Nevertheless, the securities transactions tax is a partial substitute
for TDS from capital gains.
(e) Continuing lock-in effect given existing reinvestment provisions.
Dividend income
8 Dividends received are not taxable since 2003-04. Dividends paid are taxed in the 8 (a) Equivalent to making dividends taxable at the maximum marginal
hands of companies. tax rate.
(b) Roughly increased progressivity and reduced evasion.
(c) Increased tax burden of individuals with income below the
threshold (such as retirees).
Interest income and income from other sources
9 Gifts above Rs 25,000 except gifts from family taxable as income after September 2004. 9 Useful base broadening and anti-evasion measure. However,
the provision applies to gifts taken separately not the combined
value of gifts, a design limitation.

10 Tax deductibility of specified savings up to a ceiling (under section 80L) to be abolished
as part of large-scale changes in tax treatment of saving.
10 (a) Combined with other changes, concessions are to be available
for new savings rather than existing financial assets (like bank
deposits and other small savings).
(b) Increased tax burden of individuals with income below the
threshold (such as retirees).

(Contd)

1398 Economic and Political Weekly April 2, 2005

 Table 1: (Contd)
Measure Likely Impact on Equity, Compliance Costs and Compliance

Agricultural income: Continuing constitutional exemption from Union income tax. However, existing provisions result in higher tax rates on non-agricultural
income, excluding capital gains, for those with agricultural income.

Set off of losses and selected deductions: There are partial restrictions in setting off house property losses, some business losses (excluding unabsorbed
depreciation and investment allowance), and capital losses against other income sources. Losses cannot result in a tax refund but can be carried forward for
up to 8 years in most cases.

11 No set off of business losses against salary income from 2004-05. 11 and 12 Move the income tax further towards schedular taxation of
different income sources.
12 Reduction in loss carry forward period for house property to 4 years. 12 Relative discrimination against housing income.
TDS and return filing: TDS for residents is required for most income sources except payments to businesses or professionals at specified rates. TDS is not final,
but can be subtracted from taxes self-assessed in tax returns even if this results in a refund becoming due.
13 From 2001, salary earners can ask employers to file returns on their behalf subject to 13 Reduced compliance costs since employers can benefit from
some eligibility criteria. economies of scale. Also reduced psychic compliance costs since
eligible individuals cannot be penalised for errors.

14 From 2003 returns can be filed on computer readable media at the assessee’s option. 14 Reduced compliance costs. Potentially improves computer based
detection of non-compliance.

15 The ‘1 in 6’ scheme requiring even individuals meeting certain criteria to file a return
even if they claim no taxable income made wider in the current budget.
16 From 2006, returns must be filed by persons whose income before specified deductions
would have been taxable if deductions were not claimed.
17 From 2004-05, entities (‘persons’) making specified payments above Rs 50,000
required to file annual information returns on computer media.
18 From 2006 TDS certificates no longer be required to be issued and filed with returns.
TDS claims to be cross-checked electronically by the tax department.
15 Potentially reduced non-compliance at the expense of increased
taxpayer compliance costs.
16 Potentially reduced non-compliance at the expense of increased
taxpayer compliance costs.
17 Potentially reduced non-compliance at the expense of increased
compliance costs of these entities.
18 Reduced compliance costs and potentially increased ability to
detect non-compliance if cross-matching can be effectively
implemented.

the impact of other policies and market
conditions.
The Individual Income Tax Base
Information to assess recent income tax
base changes and selected administration
reforms against the benchmarks given
above is in Table 1, for resident indivi-
duals.5 The table summarises the structure
that will obtain, given recent enacted and
proposed reforms, if the 2005 Finance Bill
becomes law. The table (and this article)
restricts attention to basic provisions. It
does not examine differential treatment
due to different end uses of income such
as between current savers and non-savers.
As the table makes clear, the 2005 Budget
has moved income tax treatment of income
from different sources further along the
road to schedular treatment. This should
result in an increase in the potential rev-
enue productivity of the income tax at the
cost of some increase in distortions and
horizontal equity. Schedular treatment is
particularly pronounced in the case of
dividends, capital gains and all types of
losses. The manner in which this has been
done, however, does not permit sufficient
compliance and compliance cost benefits
to be reaped. The main compliance and
compliance cost benefits, largely achieved
via automation, are outlined in the last two
rows of the table pertaining to return filing
and TDS (except items 15 and 16). As
argued below, the likely aggregate impact
of these and rate reforms is an increase
rather than a decrease in overall compli-
ance costs.
Two other important effects are, first,
the widened tax base for financial income
from the combined impact of dividend,
capital gain and interest income provi-
sions, together with the securities transac-
tions tax. Second, in line with a long history,
differential treatment of existing capital
and new investment has been increased,
this time via relatively liberal depreciation
of new investment.
The discussion has not explicitly fo-
cused non-corporate assessees other than
individuals (see footnote 4) because of
their declining importance. Other assessees,
including partnership firms, are mostly
subject to the corporation tax rate of 30
per cent. Several tax provisions exist which
discriminate against these assessees, par-
ticularly firms. Possibly because of this the
proportion of such assessees has been
declining rapidly (Table 2).9
The Evolution of Tax Rates
Large annual changes in the tax base,
as documented for recent years above,
have been a feature of Indian taxes at least
since independence. In consequence, the
tax burden corresponding to different
income tax rate structures cannot accu-
rately be compared across years. For
example, dividend and capital gains are
now not taxed at general rates given in
Table A1. Given this caveat, the evolution
of the tax burden according to the general
rates of income tax, inclusive of Union
surcharge and general rebates, is now
examined.
As a prelude, examine real tax slab
thresholds. The real income tax exemption
limit, after taking account of general
rebates in 2005-06 rupees, is shown in
Figure 1a for the period 1965-66 to
2005-06. Price corrections have been made
using the Consumer Price Index for Urban
Non-Manual Employees (CPIUNME,
1984-85 = 100), after chaining together
the CPIUNME with base year 1960 and
making forecasts for 2004-05 and 2005-06.
The figure shows that the real exemption
limit in 2004-05 and 2005-06 is now only
slightly below the exemption limit prevail-
ing in 1965-66. There is however some
variation by demographic and family sta-
tus.10 This suggests that the income tax
base has been narrowed to approximately
what prevailed in 1965-66. However, given
rising incomes, the proportion of the
population subject to tax should have
increased given limited changes in the dis-
tribution of income. This too has happened.
Comparing figures in Table 1 with census
population figures, income tax payers in
2001 were around 2 per cent of the popu-
lation compared to under 0.5 per cent of
the population in 1971, a 4.5 fold increase.

Economic and Political Weekly April 2, 2005 1399

 Figure 1b plots the real threshold of the Figure 1a: Exemption Limit: 2005-06 Rupees
30 per cent tax slab (after Union surcharge) 120
for the same period and price corrections
as in Figure 1a. It can be seen that the
2005-06 Budget has only restored the real 100
slab threshold to what prevailed in the
early 1970s. In 2005-06, the tax burden on
taxpayers near the Rs 2.5 lakh threshold

Rs ’000
80
will be more than it was prior to 1971-72.
Figure 2 plots effective rates of tax at nine
selected real income levels. The income
levels in 2005-06 rupees are indicated in 60
the table.11 Taxes include general rebates
and deductions not linked to end use (e g,
rebates linked to saving are not included), 40
the Union surcharge and the education

1965-66
1967-68
1969-70
1971-72
1973-74
1975-76
1977-78
1979-80
1981-82
1983-84
1985-86
1987-88
1989-90
1991-92
1993-94
1995-96
1997-98
1999-00
2001-02
2003-04
2005-06
cess. The effective tax rate is defined as
tax payable divided by gross total income
or income before end use related deduc- Financial year
tions. These effective tax rates should be Figure 1b: 30 Per Cent Slab Threshold: 2005-06 Rupees
interpreted as potential effective tax rates
400
if individuals do not try to attempt to lower
their tax dues by availing of concessions 350
such as savings rebates. The figure shows
effective tax rates for 5 years separated by 300
decade long intervals including rates for
2005-06 proposed in the budget. Clearly, 250
Rs ’000

tax rates proposed in the budget are the

200
Table 2: Individual and Non-Corporate
Income Tax Assessees, 150
1991-92 to 2005-06
100
Financial Income tax Individuals as
Year assessees (‘000) Percentage of
Non- Non-Corporate 50
1965-66
1967-68
1969-70
1971-72
1973-74
1975-76
1977-78
1979-80
1981-82
1983-84
1985-86
1987-88
1989-90
1991-92
1993-94
1995-96
1997-98
1999-00
2001-02
2003-04
2005-06
Individuals Corporate Assessees

1991-92 5878.40 7660.41 76.74

1992-93 7426.56 9151.29 81.15
1993-94 8212.97 10028.97 81.89 Financial year
1994-95 8449.12 10108.01 83.59
1995-96 8798.21 10664.00 82.50
1996-97 9761.43 11416.32 85.50
most lowest since 1965-66, except to some costs of 2.5 per cent.12 Bribe costs being
1997-98 10455.95 12893.00 81.10 extent for individuals with gross transfers between individuals are not in-
1998-99 14752.63@ 16959.00 86.99 income between the exemption limit and cluded though they further raise the cost
1999-00 17653.75 19877.00 88.81
2000-01 20662.93 22668.02 91.15 Rs 6 lakh. Das-Gupta and Mookherjee (1998) of compliance of bribe payers. The study
2001-02 23465.26$ 25877.00 90.68 estimated that high effective tax rates were finds some evidence that a large propor-
2002-03 25826.71$ 28100.00 91.91 a major determinant to tax non-compliance. tion of bribes are paid to avoid harassment
2003-04 28624.94$ 30733.24* 93.14
2004-05 32694.20$ 34644.70* 94.37 Consequently, while the rate reform im- rather than to buy favours. Leaving bribes
2005-06 37335.60$ 39053.98* 95.60 plies a reduction in potential progressivity aside, compliance costs increase the effec-
Notes:
compared to the previous three decades, tive tax burden of individuals and impose
1 Annual Reports of the CAG have stopped this is a welcome step which is likely to additional deadweight costs on society.
reporting the number of individual assessees lead to some compliance and revenue gains. Table 1 identifies some recent reforms that
after 2000-01.
2 @ Interpolation based on equations in notes 3
explicitly attempt to reduce these costs.
and 4. Likely Impact of Recent Unfortunately, recent reforms may actu-
3 * Forecast based on log (assessees) = ally have increased compliance costs rela-
0.1198 (time trend)+8.7757, R2 = 0.9594. Administration Reforms and
Data for 1991-92 to 2002-03. Budget 2005 on Compliance Costs tive to taxes! There are at least three rea-
4 $ Estimate based on trend growth rate, sons for this.
1990-91 to 2000-01: For 2001, Chattopadhyay and Das-Gupta First, note that compliance costs as a
1+growth rate = 0.0123 (time trend) + 0.7715,
R2 = 0.78, and growth/forecast in non- (2002) report preliminary estimates of non- percentage of taxes collected are the cor-
corporate assessees. 2-step estimate with corporate income tax compliance costs of rect yardstick to use: If compliance costs
assessees in 1998-99 assumed to have taxpayers and third parties. Costs are decrease but tax collection also decreases,
grown by the same percentage as non-
corporate assessees in the first step. estimated at a massive 57 per cent of taxes then the cost to society per rupee of tax
Source: Reports of the CAG, various years. collected, in addition to tax administration collected can remain high. So other things

1400 Economic and Political Weekly April 2, 2005

 Figure 2: Effective Individual Income Tax Rates limited deduction for interest income in
80 the budget will lead to an unplanned ad-
ditional tax burden on those with interest
70 yielding assets including retirees. The blow
could have been softened by introducing
Effective Rate (Per Cent)

60 a grandfathering provision for existing

1965-66
1965-66
savers. Clearly, many of the reforms out-
50
1975-76
1975-76 lined in Table 1 will add to compliance
40
costs of taxpayers. Since further reforms
1985-86
1985-86
are in the pipeline, further costs are likely
30 1995-96
1995-96 to be imposed in the near future unless
explicit transitional measures to mitigate
2005-06
2005-06
20 them are introduced.
To reduce compliance costs and also
10 improve compliance, following the Report
of the Task Force on Direct Taxes (2002)
0
reforms to improve tax administration and
61

91

196

291

522

753

907

1520

6736
simplify procedures have focused largely
Taxable Income in 2005-06 Rupees ’000 on automation. Accumulated international
evidence from other tax administrations as
Figure 3: Relative Individual Income Tax Gap well as the private sector suggests that
80 automation undertaken without organis-
70 ational and institutional reform, particularly
of incentives for tax officials, is seldom
60
successful.13 With automation, major in-
Relative Tax Gap

50 stitutional reforms being undertaken con-

sist of outsourcing various activities tra-
40
ditionally carried out by the income tax
30 department. Yet experience shows that
outsourcing can also go awry if contracts
20
are not carefully written and monitored.14
10 In consequence unless internal institutional
reform is also undertaken the chance of
0
success of ongoing administration reforms
1965-66
1967-68
1969-70
1971-72
1973-74
1975-76
1977-78
1979-80
1981-82
1983-84
1985-86
1987-88
1989-90
1991-92
1993-94
1995-96
1997-98
1999-00
2001-02
2003-04

cannot be rated as very high.

Financial year
Compliance Impact of Reforms
equal, lowering the tax burden itself Das-Gupta (2002) estimate average costs To round out the assessment of recent
raises the compliance cost per rupee of tax. of tax instability and ambiguity on indi- reforms two indicators of their impact on
Rising unit costs on this account must be vidual taxpayers each at 4 per cent of taxes compliance are presented. As can be ex-
weighed against direct measures to lower paid. A part of these costs are due to the pected, lack of direct data forces reliance
compliance costs (as in the last row of need to learn about and take account of on indicators which are not altogether
Table 1) and, in aggregate, decreased new tax provisions. Take one example of satisfactory. Table 3 presents 40 years of
compliance costs of those who cease to be other determinants: Abolition of the data on annual growth in income tax per
taxpayers. Table 3: Annual Growth in Non-Corporate Income Tax Per Assessee as a Ratio
Secondly, however, compliance costs of Annual Growth in Per Capita Net National Product at Factor Prices
are largely determined by administrative
1966-67 0.86 1986-87 0.88 1976-77 0.83 1996-97 0.81
procedures and return filing requirements 1967-68 1.00 1987-88 1.15 1977-78 0.99 1997-98 0.92
rather than the computation of taxes. The 1968-69 1.45 1988-89 0.97 1978-79 1.08 1998-99 0.77
proposed expansion of the ‘1-in-6’ scheme 1969-70 0.89 1989-90 0.95 1979-80 0.98 1999-00 0.96
1970-71 1.06 1990-91 0.99 1980-81 0.79 2000-01 0.94
and linking the requirement to file tax 1971-72 1.07 1991-92 1.01 1981-82 0.92 2001-02 0.84
returns to gross total income (Table 1, 1972-73 1.05 1992-93 0.82 1982-83 1.03 2002-03 1.07
items 15 and 16) makes it possible that the 1973-74 0.96 1993-94 1.04 1983-84 0.93 2003-04 1.13
number of non-taxable individuals required 1974-75 1.15 1994-95 1.10 1984-85 1.19 2004-05 1.04
1975-76 0.92 1995-96 0.98 1985-86 0.94 2005-06 1.06
to file tax returns may increase despite the 10 year average 1.04 10 year average 0.99 10 year average 0.97 10 year average 0.95
higher exemption limit.
Third, instability and ambiguity in in- Notes: 1. For projection methods see the notes below Table 2.
2 Per Capita NNP projected for 2004-05 and 2005-06 from 2003-04 Quick Estimates assuming a
come tax provisions and administrative nominal annual growth rate of 12 per cent and annual population growth rate per 1991-2001
procedures themselves impose high ‘psy- annual growth growth rate of 1.97 per cent.
chic’ compliance costs. Chattopadhyay and Sources: Economic Survey 2004-05 and Reports of the CAG, various years.

Economic and Political Weekly April 2, 2005 1401

1402

Appendix: Tax Rates and Data Used

Table A1: Marginal Income Tax Rates for Individuals: Financial Year 1965-66 to 2005-06
(in current rupees)

Financial Exemption EL 5000 6000 8000 10000 12500 15000 18000 20000 22000 25000 28000 30000 35000 40000 50000 60000 70000 80000 85000 100000 120000 150000 250000
Year Limit (EL) to to to to to to to to to to to to to to to to to to to to to to to and
5000 6000 8000 10000 12500 15000 18000 20000 22000 25000 28000 30000 35000 40000 50000 60000 70000 80000 85000 100000 120000 150000 250000 above

1965-66 3000 0.05 0.1 0.1 0.1 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.65 0.65 0.65 0.65
1966-67 3500 0.05 0.1 0.1 0.1 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.65 0.65 0.65 0.65
1967-68 4000 0.05 0.1 0.1 0.1 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.65 0.65 0.65 0.65
1968-69 4000 0.05 0.1 0.1 0.1 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.65 0.65 0.65 0.65
1969-70 4000 0.05 0.1 0.1 0.1 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.7 0.7 0.7 0.75
1970-71 4000 0.05 0.1 0.1 0.1 0.17 0.17 0.23 0.23 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.65 0.65 0.65 0.7 0.7 0.7 0.75
1971-72 5000 0 0.1 0.1 0.1 0.17 0.17 0.23 0.23 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.7 0.75 0.75 0.8 0.8 0.85 0.85
1972-73 5000 0 0.1 0.1 0.1 0.17 0.17 0.23 0.23 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.7 0.75 0.75 0.8 0.8 0.85 0.85
1973-74 5000 0 0.1 0.1 0.1 0.17 0.17 0.23 0.23 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.7 0.75 0.75 0.8 0.8 0.85 0.85
1974-75 6000 0 0 0.12 0.12 0.15 0.15 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.7 0.7 0.7 0.7 0.7 0.7 0.7
1975-76 8000 0 0 0 0.17 0.17 0.17 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 0.6 0.7 0.7 0.7 0.7 0.7 0.7 0.7
1976-77 8000 0 0 0 0.15 0.15 0.15 0.18 0.18 0.25 0.25 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1977-78 10000 0 0 0 0 0.15 0.15 0.18 0.18 0.25 0.25 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1978-79 10000 0 0 0 0 0.15 0.15 0.18 0.18 0.25 0.25 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1979-80 10000 0 0 0 0 0.15 0.15 0.18 0.18 0.25 0.25 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1980-81 10000 0 0 0 0 0.15 0.15 0.18 0.18 0.25 0.25 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1981-82 15000 0 0 0 0 0 0 0.3 0.3 0.3 0.3 0.34 0.34 0.4 0.4 0.4 0.5 0.5 0.55 0.55 0.55 0.6 0.6 0.6 0.6
1982-83 15000 0 0 0 0 0 0 0.3 0.3 0.3 0.3 0.34 0.34 0.4 0.4 0.4 0.5 0.525 0.55 0.55 0.575 0.6 0.6 0.6 0.6
1983-84 15000 0 0 0 0 0 0 0.25 0.25 0.3 0.3 0.35 0.35 0.4 0.4 0.4 0.5 0.525 0.55 0.55 0.575 0.6 0.6 0.6 0.6
1984-85 15000 0 0 0 0 0 0 0.2 0.2 0.25 0.25 0.3 0.3 0.35 0.35 0.4 0.45 0.45 0.5 0.5 0.5 0.55 0.55 0.55 0.55
1985-86 18000 0 0 0 0 0 0 0 0.25 0.25 0.25 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1986-87 18000 0 0 0 0 0 0 0 0.25 0.25 0.25 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1987-88 18000 0 0 0 0 0 0 0 0.25 0.25 0.25 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1988-89 18000 0 0 0 0 0 0 0 0.25 0.25 0.25 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1989-90 18000 0 0 0 0 0 0 0 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1990-91 22000 0 0 0 0 0 0 0 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1991-92 22000 0 0 0 0 0 0 0 0 0 0.2 0.2 0.2 0.3 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5
1992-93 28000 0 0 0 0 0 0 0 0 0 0 0 0.2 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4
Economic and Political Weekly April 2, 2005

1993-94 30000 0 0 0 0 0 0 0 0 0 0 0 0 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4 0.4
1994-95 35000 0 0 0 0 0 0 0 0 0 0 0 0 0 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4
1995-96 40000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4
1996-97 40000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.15 0.15 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.4
1997-98 40000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
1998-99 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
1999-00 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2000-01 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2001-02 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2002-03 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2003-04 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2004-05 50000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3
2005-06 100000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.1 0.1 0.2 0.3

Notes: 1 Due to family allowances up to 1970-71 effective exemptions varied by family status.
2 A rebate in 2004-05 for all assessees leads to a higher effective exemption limit.
3 A higher exemption limit in 2005-06 for women has been converted into an equivalent rebate in Table A2.
4 2005-05 rates pertain to the Finance Bill, 2005.
Sources: (a) Statistical Abstracts of India up to 1970-71. (b) Taxmann’s Ready Reckoners and Finance Acts for various years after 1970-71.
assessee (abbreviated AGITY) as a ratio rates are the key drivers of declining non- further. Rate reforms have decreased tax
of the growth in per capita net national compliance – not increased administration burdens across the board. This and liberal-
product (PCNNP). This indicator reflects efficiency. The declining tax gap is mir- isation have led to a decrease in the tax
tax payments per assessee taking no ac- rored in a revenue buoyancy between gap and buoyant revenue which is a major
count of individuals who should be tax- 1991-92 and 2003-04 of 1.18 (with respect success. Compliance costs remain high
payers but remain outside the tax net. Also, to Non-Agricultural Gross Domestic Prod- and reforms may have made them higher.
no correction is made for changes in tax uct at Factor Cost). Further analysis is To further simplify the tax base, gains
rates.15 The table shows that while the needed to determine the extent to which are possible by making TDS a final with-
shortfall in AGITY compared to PCNNP this excellent performance can be attributed holding tax for income from salary and
growth has, on average, increased decade to tax reforms as against broader economic interest, as has already been done for
by decade, AGITY has been above PCNNP reforms. dividends. This will greatly reduce the
growth since 2002-03 and is forecast to number of taxpayers required to file tax
remain so in 2004-05 and 2005-06 if current Where to Next? returns. It will also permit simplification
trends continue. of returns required to be filed under the
The accepted indicator of tax collection As indicated in the introduction, the expanded ‘1-in-6’ scheme limiting compli-
relative to potential is the tax gap or the assessment of recent reforms made here ance costs on this account. For salary and
ratio of tax collected to an estimate of is mixed. Tax base reforms can be taken business income, which are the major
potential tax revenue.16 Since available
data do not permit the absolute tax gap to Table A3: Individual Income Tax Rebates or Rebate Equivalents of Deductions
Based on Demographic Status: 1992-93 to 2005-06
be estimated with any precision, as a second (Rupees)
indicator of the compliance impact of
Financial (a) Senior Citizens Rebate for (b) Rebates for (c) General Rebate
reforms estimates of relative individual Years individual 65 Years Old and Women below
income tax gaps between 1965-66 and above (Section 88B of the Age 65 (Section
2004-05 are presented in Figure 3. The esti- Income Tax Act) 88C of the
mates are relative in that they normalise Upper Gross Rebate (Rs) Income Tax Act) Upper Total Amount of
Income Limit (Rs) or Rate Income Limit Rebate
the tax gap to zero in the year with the lowest
tax gap, which turns out to be 1965-66.17 1992-93 50000 0.1 na na na
1993-94 75000 0.2 na na na
The measured tax gap includes both tax 1994-95 100000 0.4 na na na
evasion and tax concessions. Its two major 1995-96 100000 0.4 na na na
1996-97 120000 0.4 na na na
limitations are that it assumes that the 1997-98 na 10000 na na na
income tax base is proportional to Non- 1998-99 na 10000 na na na
Agricultural Gross Domestic Product and 1999-00 na 10000 na na na
2000-01 na 15000 5000 na na
that individual income distribution remains 2001-02 na 15000 5000 na na
unchanged during the data period except 2002-03 na 15000 5000 na na
2003-04 na 20000 5000 na na
that mean income grows at the same rate 2004-05 na 20000 5000 100000 9000
as PCNNP. 2005-06 na 5000 2500 na na
The figure shows that the increasing Notes: (1) Gross total income is income before deductions under sections 10A, 10B, 10BA, and Chapter VIA
trend in the tax gap up to around 1991-92 of the Income Tax Act (including, e g, deductions for medical insurance, house rent and
charitable donations). Total or taxable income is income after these deductions are taken.
has been reversed in the post liberalisation (2) Rebates are taken on income tax payable before Union surcharges and cesses.
era, though the gap remains above what it (3) Rebate under Section 88D is taken before taking other rebates (including rebates under
was in the 1960s. It is likely that increased Section 88 for specified investments). The section also provides for some rebate for persons
with taxable income above Rs 1 lakh up to Rs 1,11,240 to ensure that income after tax does not
‘white economy’ opportunities due to fall below Rs 1 lakh.
liberalisation coupled with moderate tax Source: Taxmann’s Ready Reckoners and Finance Acts for various years.

Table A2: Individual Income Tax Rebates or Rebate Equivalents of Deductions Based on Family Status: 1965-66 to 1970-71
(Rupees)

Eligibility Criteria 1965-66 1966-67 1967-68 1968-69 1969-70 1970-71

Upper Total Income Limit for Rebate (Rs)
na na na 10000 10000 10000

Individuals with dependent Unmarried 100 125 125 145 145 145
parents or grandparents Total income of no children 175 200 200 220 220 220
spouse up to Rs 4000 one child 195 220 220 240 240 240
with children 215 240 240 260 260 260
Total income of no children 175 200 200 220 145 145
spouse above Rs 4000 one child 195 220 220 240 165 165
with children 215 240 240 260 185 185
Individuals without dependent Unmarried 100 125 125 125 125 125
parents or grandparents Total income of no children 175 200 200 200 200 200
spouse up to Rs 4000 one child 195 220 220 220 220 220
with children 215 240 240 240 240 240
Total income of no children 175 200 200 200 125 125
spouse above Rs 4000 one child 195 220 220 220 145 145
with children 215 240 240 240 165 165

Source: Statistical Abstract of India, various years..

Economic and Political Weekly April 2, 2005 1403

income sources, deductions for such thing route to reducing compliance costs and deductions were discontinued in India in
as saving and demographic status could raising compliance is to reorient admini- 1970-71 (Table A2).
3 See, for example, Alm and Wallace (2004).
still be allowed. An additional reform strative reforms more towards institutional 4 According to the 2004 report of the Comptrol-
which will reduce efficiency costs is and incentive reform.18 -29 ler and Auditor General, the number of
streamlining of reinvestment provisions non-corporate income tax assessees stood at
for capital gains. Nevertheless, to minimise Email: oldmonk87@yahoo.com 28.1 million. Well over 90 per cent of these
policy instability costs (and ambiguity costs are individuals, other assessees being partner-
ship firms, cooperative societies, charitable
as the recent discussion about the pro- Notes trusts, local authorities and Hindu undivided
posed tax transactions tax illustrate), these 1 Some scholars even dispute the relevance of Families. The number in the text allows for
changes should, as far as possible, be horizontal equity: See, for example, Kaplow large scale non-filing and family members of
announced well in advance and accompa- (2000). assessees not liable to pay tax, and the indirect
nied with transitional provisions. The other 2 Or, say, family size. Family size based impact of tax withholding and dividend tax
paid by corporations on individuals who are
not assessees.
Table A4: Rates of Surcharge Plus Cess for Individuals: 5 The first column of the table is compiled from
Financial Year 1965-66 to 2005-06 the 2004 Finance Act, The 2005 Finance Bill,
(As a proportion of tax due before surcharge) corresponding Explanatory Memoranda and
Singhania (2004, 2005).
Financial Rate from Second Slab Third Slab Effective 6 Includes housing boards, sports associations
Year Exemption Lower Slab Surcharge Lower Slab Surcharge Taxable (such as the BCCI), certain cooperative
Limit Limit (Rs) Limit (Rs) Threshold with societies, and various NGOs including some
Rebate (Rs) charitable trusts and societies, and trade unions.
1965-66 0 100000 0.05 na na 5750 7 Including for firms and companies whose
1966-67 0.1 0 0.1 na na 6250 corporation tax rates have been reduced from
1967-68 0.1 0 0.1 na na 6500 35 per cent to 30 per cent.
1968-69 0.1 0 0.1 na na 6500 8 Combined tax burden of less depreciation but
1969-70 0.1 0 0.1 na na 6500 lower taxes is likely to have decreased for new
1970-71 0.1 0 0.1 na na 6500 investment.
1971-72 0.1 15000 0.15 na na 5000 9 In the article, figures for 2003-04, 2005-06
1972-73 0.1 15000 0.15 na na 5000 are, of course, forecasts and subject to forecast
1973-74 0.1 15000 0.15 na na 5000 error. For assessees, up to 3 additional years
1974-75 0.1 0 0.1 na na 6000 had to be estimated. Estimation and forecast
1975-76 0.1 0 0.1 na na 8000 methods employed are described in notes to
1976-77 0.1 0 0.1 na na 8000 tables.
1977-78 0.15 0 0.15 na na 10000 10 The 1965-66 exemption limit is inclusive of
1978-79 0.15 0 0.15 na na 10000 family rebates and pertains to a married
1979-80 0.2 0 0.2 na na 10000
individual with no children. This varied, in
1980-81 0.1 0 0.1 na na 10000
2005-06 rupees, from Rs 55,255 for an
1981-82 0.1 0 0.1 na na 15000
1982-83 0.1 0 0.1 na na 15000
unmarried individual to Rs 1,13,274 for a
1983-84 0.125 0 0.125 na na 15000 married individual with two or more children.
1984-85 0.125 0 0.125 na na 15000 Figure 1a does not take into account deductions
1985-86 0 0 0 na na 18000 or rebates for senior citizens available from
1986-87 0 0 0 na na 18000 1992-93 nor those for women available since
1987-88 0 0 0 na na 18000 2000-01. If these are factored in then the real
1988-89 0 50000 0.05 na na 18000 effective exemption limit would be highest
1989-90 0 50000 0.05 na na 18000 over the period for senior citizens in 2004-05
1990-91 0 50000 0.08 na na 22000 followed by working women, in the same year.
1991-92 0 75000 0.12 na na 22000 11 Income levels correspond to average incomes
1992-93 0 100000 0.12 na na 28000 for 9 tax slabs in 1994-95 given in the CAG’s
1993-94 0 100000 0 na na 30000 1996 Report on Direct Taxes. These income
1994-95 0 0 0 na na 35000 levels were converted into rupees of the relevant
1995-96 0 0 0 na na 40000 year using the CPIUNME before computing
1996-97 0 0 0 na na 40000 taxes due.
1997-98 0 0 0 na na 40000
12 These estimates are preliminary as the data
1998-99 0 0 0 na na 50000
base was small and not very satisfactory.
1999-00 0 60000 0.1 na na 50000
2000-01 0 60000 0.12 150000 0.17 50000
13 See, for example, Clegg et al (1997), United
2001-02 0 60000 0.02 na na 50000 States Government (1995), and World Bank
2002-03 0 60000 0.05 na na 50000 (1991). On the importance of incentives and
2003-04 0 850000 0.1 na na 50000 their design see Kahn et al (2002), McLaren
2004-05 0.02 850000 0.122 na na 100000 (2003) and Milgrom and Roberts (1992). See
2005-06 0.02 1000000 0.122 na na 100000 also Das-Gupta et al (1999).
14 See Low (1995), Johnson (2001) and for a
Notes: (1) The base of surcharge and cess is TAX DUE befor surcharge and cess. recent Indian case study, Caseley (2004).
(2) Surcharge for 1965-66 to 1970-71 is for individuals having only earned income. It is the same 15 A higher exemption limit and tax rates could
or higher in other cases. result in higher or lower revenues due to the
(3) Effective exemption limit up to 1970-71 applies to a married individual with no children.
negative relation between compliance and tax
See Table A2 for more detail.
rates. So the direction of bias cannot be
(4) Since 1999-2000 marginal relief has been provided for individuals just above the surcharge
threshold to ensure that the surcharge inclusive marginal tax rate does not exceed 100 per cent
predicted.
of additional income. 16 Further discussion is in Das-Gupta and
Sources: (a) Statistical Abstracts of India up to 1970-71. (b) Taxmann’s Ready Reckoners and Finance Mookherjee (1998).
Acts for various years after 1970-71. 17 The relative tax gap indicator modifies the tax

1404 Economic and Political Weekly April 2, 2005

 compliance index in Das-Gupta and
Mookherjee (1998). For any year the tax gap
is defined as 100(1– –pi ), where i = actual non-
corporate income tax revenue and p = estimated
potential income tax revenue. Potential revenue
for a year is defined as nagdp . aetr . max(c),
where nagdp is Non-Agricultural Gross
Domestic Product at Factor Cost, aetr is the
estimated average effective tax rate and max(c)
is the maximum compliance index between
1965-66 and 2004-05. aetr is estimated as a
weighted average of 9 effective tax rates
described in footnote 11 with one difference.
Assuming that the income distribution among
taxpayers above the 1994-95 exemption limit
stays approximately the same over the data
period, incomes are assumed to grow at the
same rate as PCNNP. Thus,
∑w
nj
aetrj = i,94 t j ( yi ,94 ) General of India, Union Government (Direct
n 94 ,
i
where w is the gross income proportion of
group I in total gross income in 1994-95 CAG
data, I = 1,…,9, tj ( ) is the effective tax rate
in year j at the mean income level for group
i multiplied by the ratio of PCNNP in year
j (nj) and PCNNP in 1994-95 (n95). Finally,
i Government of India Printing Press, New Delhi.
c =
aetr.nagdp . The index, therefore,
assumes that the income tax base is proportional
to NAGDP.
18 With greater faith in the probity of tax
administration, one way to reduce taxation of
those who would fall under the exemption
limit of a global income tax is through automatic
computerised tax refunds for those whom third
party information from TDS and information
returns add to less than a taxable threshold.
However, limitations in the comprehensiveness
of cross-matching of information even with
high speed computers and administrative
corruption make this a utopian prospect.
Assessment’, paper presented at ‘The
Challenges of Tax Reform in the Global
Economy’, conference organised by the
Andrew Young School of Policy Studies,
Georgia State University, May 23-25. Available
at http://isp-aysps.gsu.edu/.
Das-Gupta, Arindam and Dilip Mookherjee (1998):
Incentives And Institutional Reform In Tax
Enforcement, Oxford University Press, New
Delhi.
Das-Gupta, Arindam Michael Engelschalk and
William Mayville (1999): An Anticorruption
Strategy for Revenue Administration, PREM
Note 33, The World Bank, Washington DC.
Government of India, Statistical Abstract of India
(various issues), Government of India, New
Delhi.
Government of India, Comptroller and Auditor
General, Report of the Comptroller and Auditor
Taxes), various years, Comptroller and Auditor
General, Delhi.
Government of India, Ministry of Finance and
Company Affairs (2002): Report of the Task
Force on Direct Taxes, Ministry of Finance
and Company Affairs, Government of India.
Government of India, Ministry of Finance and
Company Affairs (2005): Economic Survey,
Johnson, Noel (2001): ‘Committing to Civil Service
Reform: The Performance of Pre-shipment
Inspection under Different Institutional
Regimes’, Working paper No 2594, The World
Bank, Washington DC.
Kahn, Charles, Emilson C D Silva and James
Ziliak (2001): ‘Performance-based Wages in
Tax Collection: The Brazilian Tax Collection
Reform and Its Effects’, Economic Journal,
111, 118-205.
Kaplow, Louis (2000): ‘Horizontal Equity: New
Measures, Unclear Principles’, Discussion
Paper No 279, Harvard Law School,
Cambridge, Mass.
Low, Patrick (1995): ‘Preshipment Inspection
Services’, Discussion Paper 278, The World
Bank, Washington DC.
McLaren, John, Editor, (2003): Institutional
Elements of Tax Design and Reform, Technical
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Milgrom, Paul and John Roberts (1992):
Economics, Organisation and Management,
Upper Saddle River, Prentice Hall, New Jersey.
Mookherjee, D (1997): ‘Incentive Reform in
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J Stiglitz, Editors, Annual World Bank
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Singhania, Vinod K (2004): Taxmann’s Direct
Tax Ready Reckoner, 2003-04, Taxmann
Publications, New Delhi.
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Tax Ready Reckoner, 2004-05, Taxmann
Publications, New Delhi.
United States Government (1995): Tax Systems
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isation Is to Succeed, GAO/AIMD-95-156,
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Economic and Political Weekly April 2, 2005 1405