scholarly journals Income Tax Regime- Old Vs New

2021 ◽  
Vol 8 (8) ◽  
pp. 478-482
Author(s):  
Tushar D. Bagul
Keyword(s):  
Income Tax ◽  
Tax Structure ◽  
Tax Rate ◽  
The Government

The Government of India has announced new tax slab in Union Budget 2020-21. This new tax slab is also called as Optional tax regime because Government has not abolished old tax regime. The tax payer has option to choose the tax regime i.e. either Old or New which is better for them. The new tax regime has lower tax slab as compared to old tax structure. The taxpayer has given an option to either choose new tax structure with lower tax slab or the old tax one with tax benefit but higher tax slabs. The old tax regime enable taxpayer to avail existing tax exemption such as Leave Travelling Allowance, House Rent Allowance & deductions available under Income Tax Act, 1961. While those who are opting new tax regime will not have to avail advantages of existing exemptions & deductions that are available under old tax regime. The old tax regime has higher tax rate and three tax slab, whereas new tax regime has lower tax rate & six tax slabs. There is similarity in tax rate in case of individual below 60 years of age in both tax regime as it is exempted up to 2.5 lakh. In addition to this as per Section 87A (Introduced in Finance Act, 2003) Individual who is resident of India for Income Tax purpose, is entitled to claim tax rebate up to Rs.12,500 against tax liability if his/her Income does not exceed Rs.5,00,000 for old as well as new tax regime. Keywords: Income Tax, Tax Slab, Exemptions, Deductions, Old Vs New Tax Regime.

scholarly journals Study on system fairness dimensions and tax compliance in the Middle East context

2020 ◽  
Vol 18 (1) ◽  
pp. 181-191 ◽  
Author(s):  
Saeed Awadh Bin-Nashwan ◽  
Ahmed Mubarak Al-Hamedi ◽  
Munusamy Marimuthu ◽  
Abobakr Ramadhan Al-Harethi
Keyword(s):  
Middle East ◽  
Income Tax ◽  
Tax Compliance ◽  
General System ◽  
Analysis Tool ◽  
Tax System ◽  
Tax Rate ◽  
Compliance Behavior ◽  
Self Interest ◽  
The Government

People’s perceptions of a fair tax administration system have garnered growing interest as a decisive ingredient that can install compliance behavior among taxpayers. The tax that taxpayers wish to evade is determined by their perceptions of the various robust dimensions of fairness (i.e., general fairness, preferred tax rate structure, exchange with the government, special provisions, and self-interest). Such an important matter, like tax fairness, has been overlooked in the extant literature, especially in the Middle East context, although tax administrations still suffer from low and unsatisfactory rates of compliance. This paper aims to empirically examine the influence of fairness perceptions of the income tax system on compliance behavior of taxpayers in Yemen. The study used a survey questionnaire administered to 400 individual taxpayers in Hadhramout, one of the most prosperous business regions in Yemen. Based on the PLS-SEM analysis tool, the study found that general system fairness, preferred tax rate, exchange with the government, and the extent of self-interest are significantly related to income tax compliance, while special provisions do not affect compliance decisions. The results of the study can alert the tax authority and policymakers to consider the non-pecuniary factors, other than the measures of the coercion. Establishing a fair tax system is probably one of the most successful approaches to boost compliance among taxpayers, thus yielding more tax revenue and diminishing the administrative cost for the tax authority.

scholarly journals Penyesuaian Lapisan dan Tarif PPh Orang Pribadi: Agresif atau Progresif?

Owner ◽  
2022 ◽  
Vol 6 (1) ◽  
pp. 709-721
Author(s):  
Kalyana Mitta Kristanti
Keyword(s):  
Income Tax ◽  
Positive Impact ◽  
Personal Income ◽  
Tax Rates ◽  
Personal Income Tax ◽  
Middle Income ◽  
Tax Rate ◽  
Tax Harmonization ◽  
The Difference ◽  
The Government

In 2022, Indonesia would apply changes in tax brackets and rates for personal income tax. This adjustment is based on the Article 17 Paragraph 1 Tax Harmonization Law Number 7 of 2021. The government tries to accommodate the needs of the community through formulating process of this regulation. In particular, it provides convenience to the lower-middle income community and encourages an even distribution of income. People belonging to the high wealth income will be subject to the highest tariffs that have just been set through this law. Through a qualitative descriptive method in which data collection is carried out by taking from literature review; law, articles, books, and website, the author tries to analyze changes in brackets and rates of personal income tax. This study presents illustrations of the calculation to explain the difference in the amount of income tax payable before and after the implementation of the Tax Harmonization Law. In addition, the analysis of the principles of equity and democracy on the adjustment of layers and tax rates is elaborated in this paper. The results obtained explain that with the application of the new tax rate, taxpayers get a tax burden relief because the tax expense is lower due to the broadening of income range. However, wealthy taxpayers will pay more taxes because of the higher tax rates. This condition proves that the new tax rate supports vertical fairness in the taxation system. In addition, the implementation of regulations related to tax rates adjustment provides evidence that the implementation of democracy has been implemented. The adjustment of tax brackets and rates has a positive impact on the community and the government so that the allocation of tax revenues can run optimally to support the welfare of the community.

scholarly journals Kenapa Wajib Pajak UMKM Enggan Membayar Pajak Penghasilan?

2020 ◽  
Vol 30 (6) ◽  
pp. 1561
Author(s):  
Ni Putu Rossica Sari ◽  
Agus Fredy Maradona
Keyword(s):  
Income Tax ◽  
Theory Of Planned Behaviour ◽  
Research Setting ◽  
Planned Behaviour ◽  
Tax Rate ◽  
Tax Revenues ◽  
Compliance Level ◽  
Service Areas ◽  
Primary Determinant ◽  
The Government

To boost tax revenues from the SMEs sector, the government has reduced the income tax rate for SMEs through the issuance of PP Number 23 of 2018. Nevertheless, in some regions, the tax revenues from the SMEs sector have, unexpectedly, decreased. The purpose of this study is to investigate the reasons for the lack of compliance by SME taxpayers, using the theory of planned behaviour as a theoretical framework. This study employed an exploratory design using a qualitative approach, in which the service areas of the Singaraja tax office served as the research setting. The results of this study show that the primary determinant of SME taxpayers’ compliance in paying income tax is the taxpayers’ consciousness concerning the importance of tax revenues for the country’s financial wellbeing. This finding provides significant implications for the Indonesian tax authority concerning their mission to increase the compliance level of SMEs taxpayers in fulfilling their tax obligations. Keywords: Taxpayer Compliance; SME; PP Number 23 Of 2018; Taxpayer Awareness; Theory Of Planned Behaviour.

TWO COMPUTATIONS TO FUND SOCIAL SECURITY

1997 ◽  
Vol 1 (1) ◽  
pp. 7-44 ◽  
Author(s):  
HE HUANG ◽  
SELAHATTIN İMROHOROGˇLU ◽  
THOMAS J. SARGENT
Keyword(s):  
Social Security ◽  
Income Tax ◽  
Physical Capital ◽  
Labor Income ◽  
Income Volatility ◽  
Public Provision ◽  
Tax Rate ◽  
Output Ratio ◽  
The Government ◽  
The Impact

We use a general equilibrium model to study the impact of fully funding social security on the distribution of consumption across cohorts and over time. In an initial stationary equilibrium with an unfunded social security system, the capital/output ratio, debt/output ratio, and rate of return to capital are 3.2, 0.6, and 6.8%, respectively. In our first experiment, we suddenly terminate social security payments but compensate entitled generations by a massive one-time increase in government debt. Eventually, the aggregate physical capital stock rises by 40%, the return on capital falls to 4.4%, and the labor income tax rate falls from 33.9 to 14%. We estimate the size of the entitlement debt to be 2.7 times real GDP, which is paid off by levying a 38% labor income tax rate during the first 40 years of the transition. In our second experiment, we leave social security benefits untouched but force the government temporarily to increase the tax on labor income so as gradually to accumulate private physical capital, from the proceeds of which it eventually finances social security payments. This particular government-run funding scheme delivers larger efficiency gains (in both the exogenous and endogenous price cases) than privatization, an outcome stemming from the scheme's public provision of insurance both against life-span risk and labor income volatility.

scholarly journals WELFARE-MAXIMIZING OPERATIONAL MONETARY AND TAX POLICY RULES

2008 ◽  
Vol 12 (S1) ◽  
pp. 112-125 ◽  
Author(s):  
ROBERT KOLLMANN
Keyword(s):  
Public Debt ◽  
Tax Policy ◽  
Income Tax ◽  
Policy Feedback ◽  
Policy Rules ◽  
Tax Rate ◽  
Dynamic General Equilibrium Model ◽  
Final Good ◽  
The Government ◽  
The Interest Rate

This paper computes welfare-maximizing monetary and tax policy feedback rules in a calibrated dynamic general equilibrium model with sticky prices. The government makes exogenous final good purchases, levies a proportional income tax, and issues nominal one-period bonds. A quadratic approximation method is used to solve the model and to compute household welfare. Optimized policy has a strong anti-inflation stance and implies persistent fluctuations of the tax rate and of public debt. Very simple optimized policy rules, under which the interest rate just responds to inflation and the tax rate just responds to public debt, yield a welfare level very close to that generated by richer rules.

DEBT POLICY RULE, PRODUCTIVE GOVERNMENT SPENDING, AND MULTIPLE GROWTH PATHS

2008 ◽  
Vol 12 (4) ◽  
pp. 445-462 ◽  
Author(s):  
Koichi Futagami ◽  
Tatsuro Iwaisako ◽  
Ryoji Ohdoi
Keyword(s):  
Growth Rate ◽  
Steady State ◽  
Government Spending ◽  
Income Tax ◽  
High Growth ◽  
Government Debt ◽  
Government Bonds ◽  
Tax Rate ◽  
Productive Government Spending ◽  
The Government

This paper constructs an endogenous growth model with productive government spending. In this model, the government can finance its costs through income tax and government debt and has a target level of government debt relative to the size of the economy. We show that there are two steady states. One is associated with high growth and the other with low growth. It is also shown that whether the government uses income taxes or government bonds makes the results differ significantly. In particular, an increase in government bonds reduces the growth rate in the high-growth steady state and raises the growth rate in the low-growth steady state. Conversely, an increase in the income tax rate reduces the growth rate in the low-growth steady state and there exists some tax rate that maximizes the growth rate in the high-growth steady state. Finally, the level of welfare in the low-growth steady state is lower than that in the high-growth steady state.

scholarly journals Digital Transformation of Self Assessment System on Final Income Tax in Small Micro Business and Medium at Pratama Tax Office of West Bekasi

2021 ◽  
Vol 2 (3) ◽  
pp. 209-221
Author(s):  
Dwikora Harjo ◽  
Novianita Rulandari ◽  
Aprilia Alfani ◽  
Raveedhan Syachlin
Keyword(s):  
Income Tax ◽  
Government Regulation ◽  
Small And Medium Enterprises ◽  
Assessment System ◽  
The Self ◽  
Self Assessment ◽  
Tax Rate ◽  
Descriptive Research ◽  
The Government ◽  
Medium Enterprises

The phenomenon in this study is related to the self-assessment system for taxpayers in the context of the Government Regulation Number 23 of 2018 implementation, where many Micro, Small, and Medium Enterprises (MSMEs) do not understand tax administration and consider taxation obligations to be complicated. The purpose of this study is to find out and analyze the self-assessment system for final tax income on MSMEs at the Pratama Tax Office of West Bekasi in 2018-2020 along with the obstacles and efforts made by the tax office regarding the self-assessment system. This research is descriptive research with a qualitative approach. Data analysis was carried out using qualitative methods. The results of this study indicate that the implementation of Government Regulation Number 23 of 2018 regarding the self-assessment system has not fully run as expected. In terms of registration and reporting, taxpayers have complied with these regulations, but in calculating and paying their taxes they have not fully complied with the rules. The obstacles include MSMEs who are still unfamiliar with taxes and do not understand IT, regulators who are still having trouble supervising the taxation activities of taxpayers, and the lack of tax dissemination and counseling. As a result, the MSME tax contribution has decreased during 3 years due to the decline in the MSME Tax rate. The average contribution of MSME tax revenue at the Primary Tax Office of West Bekasi is 8.77% of final income tax receipts.

scholarly journals ASPEK PAJAK PENGHASILAN FINAL PADA SEKTOR USAHA MIKRO KECIL DAN MENENGAH (STUDI KASUS PT PCT TANGERANG)

2019 ◽  
Vol 6 (1) ◽  
pp. 23-28
Author(s):  
Badar Murifal
Keyword(s):  
Cash Flow ◽  
Income Tax ◽  
Government Regulation ◽  
Small And Medium Enterprises ◽  
Strong Support ◽  
Fiscal Year ◽  
Tax Rate ◽  
The Government ◽  
Medium Enterprises ◽  
Current Arrangement

AbstractIndonesia cut the final income tax rate for small and medium-sized enterprises by half, to 0.5 percent of their annual sales, in a move to help businesses manage their cash flow and expansion. While the current arrangement only demands simple accounting, small and medium-sized enterprises say it also means they have to pay income tax when they are at loss, which disrupts their cash flow(Jakarta Globes, 2018). The Government has shown its strong support for the development of small and medium enterprises (SMEs). After improving the tax facility for venture capital companies who invest in SMEs, the Government has now issued Government Regulation (GR) No.23/2018 (GR-23) which stipulates a new “final tax”rate for SMEs. GR-23 will enter into force on 1 July 2018 and revokes GR No.46/2013 regarding final tax on taxpayers within a certain turnover. The final tax regime, introduced in GR-46, is applicable for taxpay ers with annual gross turnover of not more than IDR 4.8 billion (approximately USD 340 thousand), excluding the following income: a.fees from the delivery of certain freelance services by individuals; b. overseas income which has been taxed in the source country; c. income also subject to final tax; and d. non - taxable income. The threshold of IDR 4.8 billion per annum is based on the previous years’ activity, including gross turnover sourced from branches. If during a fiscal year the gross turnover exceeds IDR 4.8 billion, the taxpayer remains subject to final tax for the current year but must adopt the “ normal tax ” rate (Article 17 or Article 31E Income Tax) for the following year. While the provisions on gross turnover generally remain unchanged, GR – 23 now reduces the final tax rate to 0.5% from the previous 1%.Key words : Final Income Tax ,  Micro, Small and Medium Enterprises.

scholarly journals Analysis of Depreciation Policy Based on Effective Tax Rate

2015 ◽  
Vol 4 ◽  
pp. 21-23 ◽  
Author(s):  
Krishna Kumar Shah
Keyword(s):  
Policy Maker ◽  
Tax Policy ◽  
Income Tax ◽  
Effective Tax Rate ◽  
Tax Rate ◽  
Wear And Tear ◽  
The Government ◽  
The Cost ◽  
Tax Deduction

Depreciation is an income tax deduction that allows a tax payer to recover the cost. It is an annually allowance for the wear and tear, deterioration or obsolesce of property .With the introduction of income tax Act 2002 the government claimed that the depreciation rule under the new law is more generous than the depreciation rule in 1992 in case of all the assets including machinery and building. This article compares Effective Tax Rate (ETR) which shows no decrease in 2002 in compassion to 1992 in ETR. It means the depreciation rule of 2002 in case of building and machinery is not generous as claimed by the tax policy maker. In contrary to this, the analysis shows that the depreciation provision of 1992 and 2002 are more liberal than the depreciation provision of 1982.DOI: http://dx.doi.org/10.3126/av.v4i0.12352 Academic Voices Vol.4 2015: 21-23

Optimal capital-income taxation in a model with credit frictions

2014 ◽  
Vol 0 (0) ◽  
Author(s):  
Salem Abo-Zaid
Keyword(s):  
Income Tax ◽  
Income Taxation ◽  
Capital Income ◽  
Capital Income Taxation ◽  
Tax Rate ◽  
Long Run ◽  
Redistributive Taxation ◽  
Optimal Capital ◽  
Credit Frictions ◽  
The Government

AbstractThe optimality of the long-run capital-income tax rate is revisited in a simple neoclassical growth model with credit frictions. Firms pay their factors of production in advance, which requires borrowing at the beginning of the period. Borrowing, in turn, is constrained by the value of collateral that they own at the beginning of the period, leading to inefficiently low amounts of capital and labor. In this environment, the optimal capital-income tax in the steady state is non zero. Specifically, the quantitative analyses show that the capital-income tax is negative and, therefore, the distortions stemming from the credit friction are offset by subsidizing capital. However, when the government cannot distinguish between capital-income and profits, the capital-income tax is positive as the government levies the same tax rate on both sources of income. These results stand in contrast to the celebrated result of zero capital-income taxation of Judd (Judd, K. 1985. “Redistributive Taxation in a Simple Perfect Foresight Model.”

Sign in / Sign up

Export Citation Format

Share Document