Economics Changing Trends

Topics: Tax, Taxation, Income tax Pages: 19 (4433 words) Published: February 18, 2013
Changing trends in Tax and non-tax revenues
Trends in tax revenue
Some of the other features of trends in tax revenue are as follows: •

Tax revenue, on an average, could finance about 60 per cent of thecenter’s revenue expenditure during the eighties. The proportionduring nineties, however, was about 55 per cent only. •

Continuing reforms and rationalization of the tax structure, haveresulted in a structural shift in composition of tax revenue •

A fall in the share of indirect tax collections from about 80 per cent of total tax revenue in eighties to about 70 per cent in the nineties couldnot be fully compensated by the increase in direct tax revenue. •

On the states' side, the dip in tax buoyancy occurred as revenue fromsales tax, the principal component of their own tax revenue, showed a declining growth trend owing to tax competition among the States toattract trade and industry. Trends in Non Tax Revenue

On the whole, non-tax revenue growth has practically stagnated at bothlevels of government, during the nineties. But there is a change in trends inthe pattern of non tax revenues.Apart from the interest receipts the other two main items of non-tax receipts.They are: •

return on investments of the Government and

recovery of cost of public services.By way of dividend and interest, return on Central government investment inpublic enterprises even though has shown some improvement was about5.21 per cent. Trends in profitability and finances of Central PublicEnterprises have shown a distinct improvement. Rates of return of most of the State government enterprises show that it does not cover even a fractionof their cost of funds.The Union government is entitled to royalty on oil and gas produced fromoffshore fields whereas the state governments get royalty from onshorefields. Royalty payable by the national oil companies from the nominatedfields vary from that for production from the fields that are governed byproduction-sharing contracts. This is significant additional revenue.The revenue from petroleum and exploration sector was Rs 9,423 crore in2008-09. In 2009-10, the revenue from petroleum sector was Rs 13,333crore

II Introduction:
The government hikes finance rates to accommodate its costs from tax and non-tax income/revenue sources. In fact, government costs go above government assets that causes government deficit. Changes:

The important trends in tax and non-tax income are discussed below: Tax Revenue:
In India, the tax-structure is best developed and the ability to levy taxes and duties is broadcast as follows: Central Government:
It levy charges on assets (apart from agronomical income), community duty, and central customs charges and service tax. State Government:
It levies taxes on agronomical income, Value Added Tax or VAT, Stamp Duty, state customs duty, acreage revenue tax and professional tax. Local Government Bodies:
Local government bodies levy Octroi and tax for utilities like water supply, acreage tax, Sanitation etc. Indian tax anatomy and arrangement have undergone assertive reforms since liberalization. These reforms included deduction in rates of all significant taxes, widening the abject of all taxes, simplifying laws and processes and addition of authoritative and administration machinery. Some of the vital trends in tax acquirement or revenue are:

Trends In Gross Tax-Revenue And Tax-GDP Ratio:
The accumulation of taxes has increased due to deduction of tax rates, description of procedures and a high GDP growth rate. The allotment of Gross tax income of the Central Government as a % of GDP has remained fixed amid 9% to 10%. This is actual low in allegory to the developed nation and various developing nations. YEARTax RevenuePercentage of GDP


Trends of Direct And Indirect Taxes:
Before privatization, the indirect taxes contributed larger than 70% to the absolute tax revenue....
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