How Tax Helps Us in Our Daily Life?

How Tax Helps Us in Our Daily Life?

Taxes help the government in earning an income which is used in a lot of projects that will also help the government in developing the economy for its country and for its people.In India, the taxes are decided by the central government and the state governments along with the local governments which include municipalities. They also decide on small taxes that can be put within the jurisdiction. All and any taxes imposed by the government should be laws. You should remember that the government on itself cannot impose or make any new taxes that they wish to.

Types of Taxes:

Taxes are of two specific types – Direct & Indirect Taxes. The difference between direct and indirect taxes is the way they are comes in the way these taxes are carried out. Direct taxes are paid by us which include wealth tax, income tax, corporate tax and more. The indirect taxes include sales tax, service tax, value added tax (VAT) etc.

Direct Tax:

Direct tax, as we have said above is the taxes which are paid directly by you. These types of taxes are carried out directly on an individual and an entity. These taxes are non-transferrable to anyone else. The Central Board of Direct Taxes also known as CBDT is the body that looks after these direct taxes. It is also part of Department of Revenue. Its duties are to support the various acts which govern many aspects of the direct taxes.

Some of these acts are:

Income Tax Act
Wealth Tax Act
Gift Tax Act
Perquisite Tax
Corporate Tax
Expenditure Tax Act
Interest Tax Act
Capital Gains Tax
Securities Transaction Tax
Indirect Tax:

Indirect Taxes are those taxes which are levied on services or goods. They are different from the direct taxes. It is because they aren’t exerted on an individual who pays it directly to the government.Thesetaxes are carried out on products which are collected by a person who is responsible for selling the product. Value Added Tax or popularly known as VAT,Sales Tax, Imported Goodsetc are the common examples of indirect tax which we hear on daily basis.These types of taxes are shown by adding them to the prices that is bought by you or the service you’ve taken which pushes up the cost of the service or product.

Some of the Indirect taxes are;

Sales Tax
Service Tax
Value Added Tax
Custom duty & Octroi Excise Duty
Benefits of Taxes:

People not always understand the idea and meaning of taxation. There are many advantages of taxes. The tax that you pay helps the government in developing the economy of the country. Some benefits of taxes are as below:

The tax payment helps in your savings and in investments. It is because if an individual invests in anything, then the money invested is cut down from the taxable income which brings down the tax he/she would have to pay. It is all written in detail in the IT Act.
Paying taxes helps you in many ways. You can apply for a Home Loan and then it is easy for the banks or financial institutions to process it as there is proof of you filling your taxes regularly.
Penalty for Not Paying Taxes:

Every type of tax has its penalties which are associated with them. If you do not pay your taxes, you can be penalized for them which in some cases leads to imprisonment. The penalties can also be like fines and jail-term depending upon the crime. It is best to pay and file your taxes on time which will only benefit you.

Pay Online:

These days you do not need to go and stand in a line or queue to wait for your turn to file up your taxes. You can pay them online also, all you to do is go and visit – But you can also pay them directly through the bank in which you hold an account. But be sure that your bank is authorized to do so by Reserve Bank of India and the Government of India for collecting direct taxes. You can also do it online using your credit card or debit card. Using your credit card is the popular thing to do as it does not cost you time and also helps you pay your taxes in one time but pay your bank in easy EMIs. The banks which are authorized by the Reserve Bank of India are given below;

1. Allahabad Bank
2. Andhra Bank
3. Bank of India
4. Indian Bank
5. Indian Overseas Bank
6. Bank of Maharashtra
7. Canara Bank
8. Axis Bank
9. Bank of Baroda
10. Oriental Bank of Commerce
11. Punjab and Sind Bank
12. Jammu & Kashmir Bank
13. Punjab National Bank
14. Standard Chartered Bank
15. State Bank of Bikaner & Jaipur
16. State Bank of Hyderabad
17. State Bank of Mysore
18. State Bank of Patiala
19. State Bank of Travancore
20. Syndicate Bank
21. UCO Bank
22. Union Bank of India
23. United Bank of India
24. Vijaya Bank
25. Central Bank of India
26. Corporation Bank
27. Dena Bank
28. HDFC Bank
29. ICICI Bank
30. IDBI Bank
31. State Bank of India

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