Individuals Paying More Taxes than Corporates
A recent report shows that individuals pay more taxes than the corporate.
The key reason for this disparity appears to be the following:
1. Tax rate disparity: high-income individuals pay up to 42.7% in taxes, while corporate tax peaks at 25.17%. Lower corporate taxes aim to attract investment and stimulate growth.
2. No deductions for individuals: unlike corporations, individuals have limited options for tax reduction, given the introduction of ‘new tax regime’
3. Progressive tax structure: Individuals are taxed progressively, placing a larger burden on higher earners.
This raises questions on tax reform to address fairness as India’s economy grows.
The comparative study of tax rate is as under:
