Income Tax Day 2024: History, Significance, Facts And More Aditi Shah NDTV Profit

Income Tax Day is observed on July 24, marking a prominent achievement in India’s fiscal history. Income tax is a tax levied by the government on the income earned by individuals and businesses during a particular financial year.

Section 2(24) of the Income Tax Act defines varied parameters of income and its sources to be considered for this tax. Income from house property, salary, capital gains, business or profession, and other sources like family pension, savings interest, gifts, and investment returns are considered among many.

Income Tax Day 2024: History

This day is celebrated on July 24 to mark the introduction of income tax in India in 1860 by Sir James Wilson. While this initial implementation laid the groundwork, it was the comprehensive Income-Tax Act of 1922 that established a structured tax system in the country.

This Act not only formalised various income tax authorities, but also laid the foundation for a systematic administration framework.

Computerisation in 1981 marked a major milestone as electronic challans were introduced. In 2009, the Centralised Processing Centre (CPC) was set up in Bengaluru to handle the bulk processing of e-filed and paper returns.

Income Tax Day not only honours the historical development of tax administration in India, but also highlights the continuous advancements and modernisation efforts to create an efficient system.

Budget 2024: Revised Income Tax Slabs Under New Tax Regime; Changes In New Tax Regime Explained

Income Tax Day 2024: Significance

Income tax provides the necessary revenue for the development and growth of society by funding essential services like healthcare, education, and infrastructure. Additionally, revenue from income tax enables investments in various sectors, and creating job opportunities.

“Taxation also influences the balance between wealth accumulation and redistribution, shaping the social character of the state. It helps in building and sustaining state power and establishing a social contract, fostering greater accountability between the state and its citizens,” a statement issued by the Ministry of Finance said.

The Ministry added, “Through tax reforms, governments can develop more responsive and accountable governance, expanding state capacity and enhancing legitimacy. Effective tax systems can lead to the development of policies that reflect the needs and preferences of the population, strengthening the bond between the government and its people.”

Income Tax Day 2024: Facts And More

Amidst the pandemic in 2020-21, the gross personal income tax (PIT) observed significant growth with a contribution of Rs 5.75 lakh crore. This marked an important contribution to the national revenue during the challenging period.

In 2021-22, the gross PIT collection accounted for Rs 7.10 lakh crore and contributed to the gradual economic recovery and enhanced tax collection mechanisms.

In 2022-23, the amount reached Rs 9.67 lakh crore.

This day marks India’s growth in tax administration, improved tax deductions, revised tax slabs, and the establishment of a fair and efficient tax system.

“As we look to the future, the progress made in tax administration and the proactive measures taken to address challenges will undoubtedly contribute to a more robust and equitable economic framework, fostering a prosperous and sustainable future for all,” the media release stated.

The following is the number of people who filed ITRs in the last four years:

2019-20: 6.48 crore

2020-21: 6.72 crore

2021-22: 6.94 crore

2022-23: 7.40 crore

Tax Slabs In the New Tax Regime 2024-25:

Budget 2024: How New Capital Gains Tax Affects Home Buyers Who Purchased Before 2001. Read more on Personal Finance by NDTV Profit.Income Tax Day not only honours the historical development of tax administration in India, but also highlights the continuous advancements and modernisation efforts to create an efficient system.  Read MorePersonal Finance, Trending 

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