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India has a range of tax structures covering business income, capital gains, wealth formation and trade/ commercial transactions. India’s tariff structures are the highest in Asia, especially on imports. However, because taxes account for 66% of the Government’s revenues, the scope for any drastic reduction in tariffs and tax rates is rather limited.
Indian taxes can be grouped in two categories:
Direct taxes: Income tax, Wealth tax and Gift tax, applying on income
Indirect taxes: Customs duties, Excise duty, Sales tax, Service tax, Octroi/entry tax, applying on commercial transactions
The Central Government levies all direct taxes and some indirect taxes. The States Governments levy local taxes such as land revenue and municipal taxes (property tax, octroi/entry tax and local sales tax). |
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ICREON