You always have a thought “Why should I pay Income Tax?”, whenever you see your salary slip you think that taxes eat up considerable portion of your salary, and you believe that taxes are nothing but a burden.
But is it truly the case? Let us have a look at the importance of Income Tax in India.
Income tax, GST, Customs Duty, Excise Duty, Road Tax, Property Tax, etc. are some of the most common taxes paid in India.
There are numerous advantages to paying taxes. They aid in the creation and maintenance of infrastructure, such as roads, and they can even assist in the establishment or maintenance of institutions necessary for the rule of law and the operation of the democratic process.
Tax money are used as follows,
- Taxes fund education. For example, in India, where illiteracy is a major problem, the government needs a lot of money to provide quality education; not only in urban areas but up to the grass root levels, including spending on school infrastructure, teacher’s salaries, research, development and innovation.
- Taxes fund public infrastructure and services. For example, in India, the country spends the highest proportion of its GDP on public infrastructure and services, as compared to other emerging economies.
- Taxes secure the country’s borders. This includes expenditures on equipment and personnel, defense research and development, defense imports, international military cooperation, and international peace-keeping operations.
- Taxes fund the government’s public transport system, including rail and road transport. This includes the purchase of a wide variety of vehicles, including airplanes, ships, buses, trains, coaches, tractors, tractors and other vehicles for road and highway construction, and other infrastructure projects.
- Taxes are also used for social development and welfare programs. For example, the government of India allocates a substantial amount of revenue, about 6% of GDP, for various social development and welfare programs, including public health and nutrition, education, and rural development programs.
- Taxes fund salaries and pensions of government employees. This includes wages and pensions of public sector employees such as central government employees, state government employees, and local government employees.
- Taxes pay the principal and interest on government debt. The government of India has a large external debt, and a sizable portion of its outstanding debt is denominated in foreign currency.
- And during these Corona times, the nation realized the need for great improvement in the Health & Medicare sector in our country. Subsequently
- Taxes fund the government’s law-enforcement agencies, including the police, the paramilitary forces, the air and sea, border patrol, customs and excise, and intelligence agencies. This includes expenditures on personnel, equipment, training, and infrastructure to provide for security and public safety.
- Healthcare & Medical Infrastructure is also funded through taxes. This includes expenditures on health and medical research and development, hospital infrastructure, health insurance, and other health services.
- Taxes fund basic economic stability and social security schemes that are meant to help people who are unemployed or have a low income, such as the National Rural Employment Guarantee Act (NREGA) and the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).
Taxes are mandatory contributions levied on individuals or corporations by a government entity, whether local, regional, or national.