Tax Project

Over View of this Report

The main purpose of this report is to study the tax systems exists in India and UK and then compare the similarities & differences with Income Tax Law in Pakistan. India is a developing country where as UK is a developed country.

So, we briefly overview the Tax Systems of India and UK and then at the end compare it with Pakistan Income Tax Systems.

Tax revenue collection is one significant issue of economic development among others. It has been said that ‘what the government gives it must first take away’. The economic resources available to society are limited, and so an increase in government expenditure normally means a reduction in private spending.

Taxation is one method of transferring resources from the private to the public sector, but there are others i.e. creation of more money, to charge for the goods and services it provides or to borrow. Taxation has its limits as well, but they considerably exceed the amounts that can be raised by resorting to the printing press, charging consumers directly, or borrowing. So while governments often use all four methods of raising resources, taxation is usually by far the most important source of government revenue.

Pakistan’s economic performance since its emergence in 1947 has remained volatile across the sectors and provinces, and even its structure has changed over the time. The tax efficiency in Pakistani tax system remained focal point for the last 25 years. However, despite all efforts the tax to GDP ratio remained constant during this period.

TAXATION SYSTEM IN INDIA

Executive Summary

The government of India imposes an income tax on taxable income of individuals, Hindu Undivided Families (HUFs), companies, firms, co-operative societies and trusts (identified as body of individuals and association of persons) and any other artificial person. Levy of tax is separate on each of the persons. The levy is governed by the Indian Income Tax Act, 1961. The Indian Income Tax...