It is proved beyond doubt that lower taxes yield more revenue. There is no need to have higher rates for higher income bracket. If that is implemented, it will generate more black money.
The purchasing power of the rupee is diminishing because of sustained inflation pressure, and the government has miserably failed to control it. Meanwhile, the number of millionaires is increasing at a blinding rate because of the growth rate in the economy. But the cost of living is too much of a burden for those who are unable to earn a sizeable income. Therefore, it would be a good idea to raise the exemption limit for income tax to at least Rs 5 lakh a year for individual assessees.
As medical costs are also rising, it will be better to raise the current reimbursement of medical expenditure of up to Rs 15,000 to Rs 30,000. It would be even better if the assessee is not required to submit medical bills.
Mahesh Kapasi, New Delhi