A STUDY OF THE IMPACT OF INCOME TAX ON THE REVENUE OF GOVERNMENT OF INDIA: AN EMPIRICAL ANALYSIS
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"A STUDY OF THE IMPACT OF INCOME TAX ON THE REVENUE OF GOVERNMENT OF INDIA: AN EMPIRICAL ANALYSIS"
Authors:
Mr. Prasad Ratnakar Patil
Assistant Professor, B.Y.K. College (Sinnar) of Commerce, Nashik,
Research Scholar, Research Centre: R.N.C. Arts, J.D.B. Commerce and N.S.C. Science college, Nashik-Road, Maharashtra, Savitribai Phule Pune University.
Dr. Thakur Akash Ashok
Vice Principal,
Research Guide: R.N.C. Arts, J.D.B. Commerce and N.S.C. Science College Nashik-Road, Maharashtra, Savitribai Phule Pune University.
Abstract: This paper investigates Income tax is a critical component of the Government of India’s revenue, contributing significantly to fiscal resources that fund public expenditure and development initiatives. This paper examines the impact of income tax on government revenue, focusing on trends, determinants, and economic implications from 1980-81 to 2024-25. Using secondary data from government reports and econometric analysis, the study explores the relationship between Income tax collections, tax policy reforms, compliance, and economic growth. Findings indicate that income tax revenue has grown steadily, driven by improved compliance, economic expansion, and digital tax administration. However, challenges such as tax evasion, a narrow tax base, and reliance on indirect taxes persist. The paper concludes that while income tax significantly boosters’ government revenue, broadening the tax base and simplifying tax structures are essential for sustainable fiscal growth. Recommendations include enhancing tax compliance mechanisms and reducing exemptions to improve revenue productivity.
Keywords: Income Tax, Government Revenue, Tax Reforms, Indian Economy, Fiscal Policy
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