TAXING AGRICULTURE An Economic Necessity Group 11 Yudhir Agrawal Akash Mittal

What is agricultural income? Income from agricultural operations on land Income from sale or processing of agricultural produce raised on agricultural land Income from rent of agricultural land

Income from agricultural operations on land

Income from sale or processing of agricultural produce raised on agricultural land

Income from rent of agricultural land

Statistics and Facts Agriculture provides employment to approx. 60% of Indian population Agriculture contributes approx. 20% of Indian GDP As per the Indian Constitution, Agricultural Tax is the purview of State Governments

Agriculture provides employment to approx. 60% of Indian population

Agriculture contributes approx. 20% of Indian GDP

As per the Indian Constitution, Agricultural Tax is the purview of State Governments

Statistics and Facts

Statistics and Facts

Target Population Adding those individuals into the tax net who evade taxes by falsely showing their income as agricultural income Adding more individuals to the tax net, who generate agricultural income and are worthy of contributing to the development of the country

Adding those individuals into the tax net who evade taxes by falsely showing their income as agricultural income

Adding more individuals to the tax net, who generate agricultural income and are worthy of contributing to the development of the country

The way to go… Instructing states for strict implementation of agriculture tax and giving incentives to the states doing so Redistributing tax collected from agriculture to the states in the same proportion Making necessary constitutional changes to implement the taxation if states fail to act earnestly

Instructing states for strict implementation of agriculture tax and giving incentives to the states doing so

Redistributing tax collected from agriculture to the states in the same proportion

Making necessary constitutional changes to implement the taxation if states fail to act earnestly

The way to go… Individuals can be included into the net by defining “Consumption Points” and maintaining accurate records of the same Tax slabs and rates should be same Generated revenue to be used only for agriculture infrastructure enhancement and increasing subsidies and crop insurance

Individuals can be included into the net by defining “Consumption Points” and maintaining accurate records of the same

Tax slabs and rates should be same

Generated revenue to be used only for agriculture infrastructure enhancement and increasing subsidies and crop insurance

Benefits To curb evasion of tax in the pretext of agricultural income and also curb conversion of black money into white Encourage environmentally friendly land use because of targeted tax incentives for conservation and land preservation activities and reduced tax benefits for harmful practices

To curb evasion of tax in the pretext of agricultural income and also curb conversion of black money into white

Encourage environmentally friendly land use because of targeted tax incentives for conservation and land preservation activities and reduced tax benefits for harmful practices

Pitfalls The rural rich save most of their money in the form of gold. Until gold trading is fully regulated and considered as a consumption point, the rural rich will escape from the tax net Agricultural tax can be evaded under the pretext of a joint family system

The rural rich save most of their money in the form of gold. Until gold trading is fully regulated and considered as a consumption point, the rural rich will escape from the tax net

Agricultural tax can be evaded under the pretext of a joint family system

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