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{{Use Indian English|date=December 2015}} | {{Use Indian English|date=December 2015}} | ||
{{Infobox government agency | {{Infobox government agency | ||
| name = | | name = Income Tax Department | ||
| native_name = आयकर विभाग | |||
| seal = | | seal = | ||
| logo = Logo_of_Income_Tax_Department_India.png | | logo = Logo_of_Income_Tax_Department_India.png | ||
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| minister1_name = [[Nirmala Sitharaman]] | | minister1_name = [[Nirmala Sitharaman]] | ||
| minister1_pfo = [[Finance Minister of India|Finance Minister]] | | minister1_pfo = [[Finance Minister of India|Finance Minister]] | ||
| chief1_name = | | chief1_name = Jagannath Bidyadhar Mahapatra, [[Indian Revenue Service|IRS]] (IT:1985)<ref>{{cite web|url=https://www.thehindubusinessline.com/news/jb-mohapatra-named-acting-chairman-of-cbdt/article34692341.ece|title=JB Mohapatra named acting Chairman of CBDT}}</ref> | ||
| chief1_position = [[Chairman, Central Board of Direct Taxes]] | | chief1_position = [[Chairman, Central Board of Direct Taxes]] | ||
| parent_department = [[Government of India]] | |||
| website = {{URL|http://incometax.gov.in}} | | website = {{URL|http://incometax.gov.in}} | ||
}} | }} | ||
{{Taxation}} | {{Taxation}} | ||
The '''Income Tax Department''' (also referred to as '''IT Department''' or '''ITD''') is a [[government agency]] undertaking [[Direct tax#Direct taxation in India|direct tax]] collection of the [[Government of India]]. It functions under the Department of Revenue of the [[Ministry of Finance (India)|Ministry of Finance]].<ref>{{cite web|url=https://dor.gov.in/functions|title=Department of Revenue- Functions|access-date= January 1, 2019|archive-url=https://web.archive.org/web/20190110142631/https://dor.gov.in/functions|archive-date=10 January 2019}}</ref> Income Tax Department is headed by the apex body [[Central Board of Direct Taxes]] (CBDT). Main responsibility of IT Department is to enforce various direct tax laws, most important among these being the [[The Income-tax Act, 1961|Income-tax Act, 1961]], to collect [[revenue]] for Government of India. It also enforces other economic laws like the [[Benami Transactions (Prohibition) Act, 1988]]<ref>{{cite web|url= http://egazette.nic.in/writereaddata/2016/171245.pdf|website= The Gazette of India|title= THE BENAMI TRANSACTIONS (PROHIBITION) AMENDMENT ACT, 2016|date= August 11, 2016|access-date= January 10, 2019}}</ref> and the [[Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015|Black Money Act, 2015]].<ref>{{cite web|url= http://www.egazette.nic.in/WriteReadData/2015/164107.pdf|website= The Gazette of India|title= THE BLACK MONEY (UNDISCLOSED FOREIGN INCOME AND ASSETS) AND IMPOSITION OF TAX ACT, 2015|date= May 27, 2015|access-date= January 10, 2019}}</ref> | |||
The Income Tax Act, 1961 has wide scope and empowers ITD to levy tax on income of [[individuals]], [[firms]], [[companies]], [[local authorities]], [[societies]], or other [[Juridical person|artificial juridical persons]].<ref>{{cite web|url=https://archive.india.gov.in/business/taxation/income_tax.php|title=Who is liable to pay income tax}}</ref> Therefore, Income Tax Department influences businesses, professionals, NGOs, income earning citizens, and local authorities among others. The Act empowers Income Tax Department to tax international businesses and professionals and therefore ITD deals in all matters of [[Tax treaty|Double Taxation Avoidance Agreements]] and various other aspects of [[international taxation]] such as [[Transfer pricing]]. Combating [[tax evasion]] and [[tax avoidance]] practices is key duty of ITD to ensure constitutionally guided [[political economy]]. One measure to combat aggressive tax avoidance is [[General anti-avoidance rule (India)|General Anti Avoidance Rules (GAAR)]].<ref>{{citation | url=http://economictimes.indiatimes.com/news/economy/policy/union-budget-2012-gaar-empowers-i-t-department-to-deny-tax-benefits-to-companies/articleshow/12291369.cms | work=The Times Of India | title=Union Budget 2012: GAAR empowers I-T department to deny tax benefits to 'companies' |date=2012-03-16}}</ref> | The Income Tax Act, 1961 has wide scope and empowers ITD to levy tax on income of [[individuals]], [[firms]], [[companies]], [[local authorities]], [[societies]], or other [[Juridical person|artificial juridical persons]].<ref>{{cite web|url=https://archive.india.gov.in/business/taxation/income_tax.php|title=Who is liable to pay income tax}}</ref> Therefore, Income Tax Department influences businesses, professionals, NGOs, income earning citizens, and local authorities among others. The Act empowers Income Tax Department to tax international businesses and professionals and therefore ITD deals in all matters of [[Tax treaty|Double Taxation Avoidance Agreements]] and various other aspects of [[international taxation]] such as [[Transfer pricing]]. Combating [[tax evasion]] and [[tax avoidance]] practices is key duty of ITD to ensure constitutionally guided [[political economy]]. One measure to combat aggressive tax avoidance is [[General anti-avoidance rule (India)|General Anti Avoidance Rules (GAAR)]].<ref>{{citation | url=http://economictimes.indiatimes.com/news/economy/policy/union-budget-2012-gaar-empowers-i-t-department-to-deny-tax-benefits-to-companies/articleshow/12291369.cms | work=The Times Of India | title=Union Budget 2012: GAAR empowers I-T department to deny tax benefits to 'companies' |date=2012-03-16}}</ref> | ||
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The 19th century saw the establishment of British Rule in India. Following the [[Indian Rebellion of 1857|Mutiny of 1857]], the British Government faced an acute financial crisis. To fill up the treasury, the first Income-tax Act was introduced in February, 1860 by James Wilson, who became British-India's first [[Finance Minister]].<ref name="businessline"/> The Act received the assent of the [[Governor-General of India|Governor General]] on July 24, 1860, and came into effect immediately. It was divided into 21 parts consisting of no less than 259 sections. Income was classified under four schedules: i) income from landed property; ii) income from professions and trade; iii) income from securities, annuities and dividends; and iv) income from salaries and pensions. Agricultural income was subject to tax.<ref name="businessline" /> | The 19th century saw the establishment of British Rule in India. Following the [[Indian Rebellion of 1857|Mutiny of 1857]], the British Government faced an acute financial crisis. To fill up the treasury, the first Income-tax Act was introduced in February, 1860 by James Wilson, who became British-India's first [[Finance Minister]].<ref name="businessline"/> The Act received the assent of the [[Governor-General of India|Governor General]] on July 24, 1860, and came into effect immediately. It was divided into 21 parts consisting of no less than 259 sections. Income was classified under four schedules: i) income from landed property; ii) income from professions and trade; iii) income from securities, annuities and dividends; and iv) income from salaries and pensions. Agricultural income was subject to tax.<ref name="businessline" /> | ||
Subsequently, many laws were brought to streamline income tax laws. For example, Super-Rich Tax was introduced in 1918 and new Income-tax Act was passed in 1918. But most important among all these were the Income-tax Act of 1922. This Act of 1922 marked an important change from the Act of 1918 by shifting the administration of the income tax from the hands of [[Presidencies and provinces of British India|Provincial Government]] to the [[Government of India|Central government]]. Another remarkable feature of this Act was that the | Subsequently, many laws were brought to streamline income tax laws. For example, Super-Rich Tax was introduced in 1918 and new Income-tax Act was passed in 1918. But most important among all these were the Income-tax Act of 1922. This Act of 1922 marked an important change from the Act of 1918 by shifting the administration of the income tax from the hands of [[Presidencies and provinces of British India|Provincial Government]] to the [[Government of India|Central government]]. Another remarkable feature of this Act was that the rates were to be enunciated by the [[Finance Act (India)|annual finance Acts]] instead of in the basic enactment.<ref name="shodhganga">{{cite web|url=https://shodhganga.inflibnet.ac.in/bitstream/10603/113603/8/08_chapter%203.pdf|title=EVOLUTION OF INCOME TAX SYSTEM IN INDIA|publisher=Shodhganga}}</ref> Again, new Income-tax Act came in 1939. | ||
===Contemporary times=== | ===Contemporary times=== | ||