The editorial “Broad-basing tax reform” (Business Line, November 26) has correctly observed that “Rationalised tax levies have helped expand revenues and raise the tax-GDP ratio.

But fiscal reforms still have a long way to go”.

It is indeed amazing that in a country such as India, where a large percentage of people are struggling to have a square meal a day, the contribution of direct taxes to the nation’s exchequer has been growing steadily.

This, of course, must be due to the ever-increasing income of the salaried people and their prompt payment of income-tax, thanks to the provision of deduction (of tax) at source, giving little scope for evasion.

But, one cannot be oblivious to the fact that the salaried people work hard throughout the year and earn considerable income only to pay a chunk of it as tax at the end of the financial year. After all, tax is a fine for doing well.

Those earning income from businesses and professions must file their returns promptly and honestly, as this would not only avoid a parallel economy but also enhance the contribution of direct taxes to the government treasury.

S. Ramakrishnasayee Ranipet (TN)

(This article was published in the Business Line print edition dated November 27, 2007)
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