Illustration showing a stamper with words 'Income Tax'. For representational purposes.
Credits: iStock Photo
Finance Minister Nirmala Sitharaman will present the Union Budget on July 23, having already presented an Interim Budget ahead of the Lok Sabha elections. In light of the upcoming Budget, we take a look at some of the terms associated with the exercise.
What are direct taxes?
Direct tax refers to the taxes that are levied directly on the income or wealth of individuals or organizations. The primary characteristics of direct taxes are that they are imposed directly by the government and are paid directly by the taxpayer to the government. Key examples of direct taxes in India include:
Income Tax: This is a tax on the income of individuals or entities. The rates vary depending on the level of income and the type of taxpayer (individual, company, firm, etc.). India has a slab-based income tax system, where the rate increases with the level of income.
Corporate Tax: This tax is levied on the profits earned by companies operating in India. The rate of corporate tax varies based on factors like the type of company, turnover, and income levels.
Capital Gains Tax: This is a tax on the profits that an individual or a corporation earns from the sale of capital assets, like stocks, bonds, property, etc. The rate depends on the type of asset and the duration for which it was held.
Securities Transaction Tax (STT): This is a tax payable on the value of securities (like stocks) transacted through a recognized stock exchange.
Property Tax: This is a local tax imposed on owners of properties, based on the value of the property.
The administration and collection of direct taxes in India are primarily handled by the Central Board of Direct Taxes (CBDT), which functions under the Ministry of Finance. The system of direct taxation is constantly evolving to accommodate economic changes, address tax evasion, and improve tax collection efficiency.
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Union Budget 2024 | Making a record for any Finance Minister, Nirmala Sitharaman will be presenting her 7th Union Budget on July 23, 2024 under the Modi 3.0 government. While inflation has burnt a hole in the pockets of 'aam janata', will this Budget spell relief for Indians? Track the latest coverage, live news, in-depth opinions, and analysis only on Deccan Herald. Also follow us on WhatsApp, LinkedIn, X, Facebook, YouTube, and Instagram.