Taxation laws in India

The major tax enactment in India is the Income Tax Act of 1961 passed by the Parliament, which imposes a tax on income of individuals and corporations. This Act of 1961 imposes a tax on income under the following five heads;

* Income from house and property,
* Income from business and profession,
* Employment Income,
* Income in form of Capital gains, and
* Other income

In essence, the Act of 1961 imposes tax in the nature of the following;

* Income Tax
* Corporation Tax
* Capital gains tax
* Fringe Benefit Tax
* Inheritance tax

Other major taxation laws enacted by the Parliament are;

1. Wealth Tax Act, which has a regular history of being passed and repealed;
2. Service Tax, imposed under Finance Act, 1994, which taxes the provision of services provided by service providers within India or services imported by Indian from outside India;
3. Central Excise Act, 1944, which imposes a duty of excise on goods manufactured or produced in India;
4. Customs Act, 1962, which imposes duties of customs, counterveiling duties and anti-dumping duties on goods imported in India;
5. Central Sales Tax, 1956, which imposes sales tax on goods sold in inter-state trade or commerce in India;
6. Transaction Tax, which taxes transactions of sale of securities and other specified transactions;

The major taxation enactments passed by the State Legislatures are in the nature of the following;

1. Excise duties on tobacco, alcohol and narcotics;
2. Sales tax, on sale of goods within the State;
3. Stamp duties, on sale of property situated within the State;
4. Entertainment taxes