Question 1 · 10 marks · 115 words written
Opening
In the recent budget, Finance minister announced [some] tax reforms, one increasing exemptable income upto ₹12 lakhs per annum.
Body · points and prose
Improving Tax Buoyancy and base
(1) Better reporting of income and filing ITR → only 7 crore people file ITR in India
(2) reduction in Tax avoidance and evasion by micro & small enterprises owners
(3) Improved tax collection in long-run → due to rationalisation of slabs
(4) Simplifying tax laws will encourage citizens in reporting their income
(5) Formalisation of economy → Improved ITR filing
Close · a way forward
India must reform its tax laws on the similar line of corporate tax reforms which led to double tax revenue to ₹10 lakh crore within 8 years of reforms.