It is important for you to understand, that tax is taken by the Government to ensure that there is development in the county with the money received as the tax. Hence, it is really imperative that you pay tax. It is likewise imperative for you to know that there are 20 types of taxes.
Direct taxes involve the taxes which are directly payable and imposed by the Government of India.
- Income tax– Every citizen of India, whose total income exceeds a particular limit as set by the Government, has to pay income tax.
- Capital Gains tax– when you sell some property or share or bond or some precious metal, capital asset, then you have to pay under capital gains.
- Securities Transaction tax– Security transaction tax is applicable to each and every transaction at the stock exchange.
- Perquisites tax– Perquisite tax involves the non-monetary benefits which an employer provides to its employee.
- Corporate tax– corporate taxes are applicable to the income of the corporation which is operating in India.
Indirect taxes are not levied on the income or profits; they are applicable to the goods and services.
- Sales tax– When there is a sale of movable goods, the sales tax is applicable to it.
- Service tax– when you take any sort of paid service, you are liable to pay the service tax.
- Value Added tax-The tax, which is imposed by Central Government on the sales of goods is VAT.
- Customs duty and Octroi– when you are importing some goods in India, then you are liable to pay the Customs duty as a tax. Octroi is an entry tax for goods which are entering into a Municipality or other jurisdiction.
- Excise Duty-the type of tax, which is applicable to the removal of goods from a factory.
- Anti Dumping Duty– it involves goods being exported from a country to another country, at a price which is lower than the normal value.
Other taxes involve the following taxes:-
- Professional tax– Professional tax is payable by earning professionals.
- Dividend Distribution tax– When a company distributes the dividend to his shareholders, it has to pay the Dividend Distribution tax to the Indian Government.
- Municipal tax– Municipal tax is the tax payable by the owner of the property.
- Entertainment tax-State Government levy this tax. The central government cannot levy this tax.
- Registration, transfer tax-the taxes are payable when you are planning to purchase a property.
- Education Cess, Surcharge-Education Cess is 3% which is applicable on all sorts of taxes. The Surcharge is extra tax or fees apply.
- Gift tax– when you receive a gift from someone, IT Act covers gift tax.
- Wealth tax– Wealth tax is a direct tax, which is applicable to the net wealth of the assessee.
- Toll tax– there are some places where you have to give toll tax in order to use the infrastructure. So it is a tax for using the road.