Q.3) Examine the evolution of the tax system in India and assess the contribution of the reports of the Tax Reforms Commission in improving India’s tax system through its various recommendations. (10 Marks)

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https://www.financialexpress.com/opinion/trc-gave-direction-to-indias-tax-reforms/2284549/

In the intro, mention that in 1973-74 the personal income tax structure had 11 brackets with the highest rate as 22%.

In the body, mention the changes adopted in India’s tax system, especially after 1991 reforms and how these changes were based on the TRC’s various recommendations.

Conclude by mentioning that tax reform is still a work in progress, but surely the TRC was instrumental in making a directional change.

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17 responses to “Q.3) Examine the evolution of the tax system in India and assess the contribution of the reports of the Tax Reforms Commission in improving India’s tax system through its various recommendations. (10 Marks)”

July 7, 2021

Rubzzz Rajput

Plz review my ans

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1. July 7, 2021
  
  Utkarsha Yadav
  
  Overall a good attempt.
  Intro is good, data written is also nice.
  
  In the body, try to add more headings and subheads to increase its visibility.
  
  Conclusion is fine 🙂
2. July 8, 2021
  
  Rubzzz Rajput
  
  Thank you so much.. it’s my first attempt. And two days before I have started writing.. I will definitely improvise.. and will consider your suggestions.. 😘☺️
July 7, 2021

Utkarsha Yadav

Please review
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1. July 13, 2021
  
  Swatantra
  
  Utkarsha
  
  Good attempt but your answer is very high on data. It will be hard to remember all of those, so try to figure out the trends. High tax rates in 1973-74, lowered in 85-86, TRC lowered them further.
  
  Also after 73-74, come to 85-86 then mention TRC 1991 and further, this will maintain the coherence of the answer.
  What you have mentioned under 85-86 heading are actually TRC 1991 rates, in 85-86 income-tax highest marginal rate was still 50%
  
  Points under recommendations are good.
  
  Also mention the trend for import duties, continuosly reduced after 1991 to make manufacturing competitive till 2018 when trend was reversed.
  
  Also in GST point you can mention some of the taxes that have been subsumed. One nation-one tax principle. Current rate of corporate tax and highest slab of income tax can also be mentioned to give a holistic perspective.
  
  Conclusion is good.
  
  Keep practicing. 🙂
July 7, 2021

Fauzyia Jafri

Please review 🙂
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1. July 13, 2021
  
  Swatantra
  
  Fauziya
  
  Decent attempt. Data heavy answer, good if you can remember all of these otherwise try to remember broader trends in each part- personal tax, corporate tax, import duty etc. That will indicate the direction in which reforms are heading.For example- import duties, continuosly reduced after 1991 to make manufacturing competitive till 2018 when trend was reversed, similarly reduction in corporate tax, income tax.
  
  Proposals mentioned are good.
  
  85-86 is before tax reforms commission, TRC was formed in 1991. In 85-86 income-tax reform had reduced the brackets to four and the highest marginal rate was still 50%, only in 1991 recommendations three rates (20%, 30% and 40%) were proposed.
  
  Also mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.
  
  Conclusion is fine.
  Keep practicing. 🙂
  
  5.5/10
July 8, 2021

ankita thakur

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1. July 13, 2021
  
  Swatantra
  
  Ankita
  
  Decent attempt. Introduction is good.
  Changes brought are also fine. Before 1991, you can also briefly mention about tax structure during 85-86.
  
  Points about 1991 and tax reforms commission are good. After that try to broadly identify trends in personal income tax structure and corporate tax structure also just like you did for import duties.
  
  Also mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.That will give a holistic view.
  
  Conclusion is good.
  
  Read some other answers. Keep writing. 🙂
  
  5.5/10
July 8, 2021

SUMITA DOWERAH

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1. July 14, 2021
  
  Swatantra
  
  Sumita
  
  Good attempt. Introduction and write-up on tax reforms is good.
  
  You can add some more recommendations of the TRC- like increasing share of direct taxes; reducing trade taxes (you can link this with continuos decrease of import duties since 1991 to make manufacturing competition until 2018 when the trend was reversed).
  
  Also mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.That will give a holistic view.
  
  Then conclude.
  
  Keep practicing. You are writing well. 🙂
July 10, 2021

Kartikey Singh

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1. July 14, 2021
  
  Swatantra
  
  Kartikey
  
  Nice attempt. Introduction is good. In tax structure before 1991, you can also mention about some reforms attempted in 85-86 but they proved insufficient. Rest of the points are good.
  
  After that mention Tax Reform Commision. Points are good, in rationalizing the taxes you can elaborate a bit- aim was to increase share of direct taxes, reduce rate, reduce share of trade taxes. Remaining points are fine, results are also fine.
  
  Then very briefly also mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.That will give a holistic view.
  
  Then conclude.
  
  Keep practicing. You are writing well. 🙂
July 10, 2021

Fun Learning with Rajlaxmi.

Refno 0000420120

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1. July 14, 2021
  
  Swatantra
  
  Rajlaxmi
  
  In introduction, mention independent India, evolution of tax system has been happening since ancient times.
  
  Also points pre 1991 are fine, 15% was surcharge, not subsidy.
  
  In reforms of 1991, mention tax reforms commission. Also try to identify the broad trend lines of personal income tax, corporate tax and import duty. Remembering exact rates will be hard, trends will work fine. Points mentioned are good.
  
  Some points can be added- reforms had an aim of increasing share of direct tax in total tax, reducing share of trade tax; domestic excise was converted into VAT.
  
  Then very briefly after 2002,also mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.That will give a holistic view.
  
  Then conclude.
  
  Keep practicing. You are writing well.
July 11, 2021

Murari Jha

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1. July 14, 2021
  
  Swatantra
  
  Murari
  
  You have written everything around the answer but the main thing that needs to be mentioned is missing.
  
  Introduction is fine. Cut short the 3rd para- just mention tax reforms commission was formed in 1991. Persons are not that important, policy is important.
  
  Then mention recommendations of TRC- what they did to personal income tax, corporate tax, import duty – mention their trends since 1991
  The also mention that reforms we’re aimed at broadening the tax base, minimising evasions, improving tax administration through computerization, reducing share of trade taxes and increasing share of direct taxes in total tax etc.
  
  After that points are fine, in GST point mention about current status, GST-taxes subsumed- one nation one tax, low corporate tax, 30% highest slab for income tax.That will give a holistic view.
  
  Then conclude.
  
  Keep writing.