Understanding the Basics of Taxation Law

Central Board of Direct Taxes (CBDT) chairman Ravi Agrawal stated in the recent update, "The committee is looking for the best global practices that can adapt well-cutting redundancies.” This statement highlights the efforts of the government on making the taxation system modernise.

Taxation in India can be defined as a body of rules and regulations that govern the implementation of taxes. Taxes are collected from individuals and businesses for public services and programs. Sir James Wilson, British India’s first Finance Minister, was the first to introduce the Taxation Law Act in February 1860.

Want to know more about the taxation law? Continue reading. This blog aims to discuss the taxation law in India. If you are a student and want to opt for a Bachelor of Law LLB, you can enrol at Manipal University Jaipur. Now, let's read more about taxation law.

Income Tax in India

Managing finances is essential for taxes, which are considered a source of income for the government. As of July 11, India’s net direct tax collection showed a significant growth of 19.54% in FY25. Let us now discuss the new income tax slab recently introduced in 2024.

Tax slabs

The tax slabs have changed since the introduction of Budget 2024. Paying taxes is essential, but before paying your taxes, you can look at these new slabs set for 2024.

Income Tax Slabs (Rs)	Income Tax Rate (%)
From 0 to 3,00,000	0%
From 3,00,001 to 7,00,000	5%
From 7,00,001 to 10,00,000	10%
From 10,00,001 to 12,00,000	15%
From 12,00,001 to 15,00,000	20%
From 15,00,001 and above	30%

Deductions and Exemptions

Understanding deductions and exemptions is important for reducing taxable income. Here is the table providing details of deductions and exemptions:

Deduction	Description	Maximum Deduction
80C	Investments and savings (PPF, life insurance, NPS, etc.)	₹1.5 lakh
80D	Health insurance premiums	₹50,000 (individual), ₹1 lakh (family)
80DD	Disability expenses	₹75,000 (severe disability), ₹50,000 (moderate disability)
80E	Interest on education loan	Actual interest paid
80CCD(2)	Employer's contribution to NPS	14% of basic salary
80CCD(1B)	Additional contribution to NPS	₹25,000

Tax Planning

We all know how technology shapes the world around us. Today’s tax planning mixes business and technology to focus on consistency and achieving the organisation’s goal. Tax planning involves strategising to minimise tax liabilities through legal means which help people and businesses.
Doing investments and expense management can lead to effective tax planning. To better understand tax planning, you can enrol in the LLB program offered by Manipal University, Jaipur. You can check out the BA LLB fee structure.

Goods and Services Tax

Goods and Services Tax (GST) is an indirect tax levied on our goods and services. It is considered an umbrella tax, replacing central taxes such as central excise, service tax, etc.

The new updates introduced by the government in GST on 12/2024 discuss some of the essential changes that aim to improve GST efficiency and accuracy. The new GSTR-1A enhances flexibility. According to the latest information, effective September 1, GST payers without valid bank accounts are barred from filing GSTR-1.

IGST: IGST is an integrated goods and services tax, considered an indirect tax levied on the supply of various goods and services. Recent reports show that Kerala has recorded a 7.07% increase in IGST revenue in 2023- 2024.
CGST: The central government of India applies the CGST, which is the central goods and service tax. Understanding CGST taxes is important, as basic necessities are taxed at 5%, and standard goods and services are taxed at a 12% slab as of now.

Understanding these different taxes is crucial for students pursuing a Bachelor of Law (LLB) at Manipal University Jaipur, as it helps them advise clients and navigate complex regulations.

Corporate Tax

Corporate tax is a direct tax levied on the net income or profit. Recent news shows that Finance Minister Nirmala Sitharaman has announced a focus on India’s commitment to pillar two, which aims to implement a global minimum effective corporate tax of 15%. Countries like the EU, Singapore, the UK, and Switzerland have also agreed to pillar two to influence investments into and out of India.
According to official reports, corporate tax collection grew by 20.44% in 2023-2024, which is good progress. If you are interested in starting a business or studying LLB law, you must know about corporate law, as laws enable future professionals to provide accurate advice and navigate disputes.

Other Taxes

Other taxes, like property and sales tax, also faced significant changes in India. Regarding property taxes, the budget of 2024 made prominent adjustments in these levied on real estate. It reduced the tax rate on long-term capital gains from 20% to 12.5%. Does this sound great?

Recent Updates and changes

Regarding the most recent update about the taxation law in India, Finance Minister Nirmala Sitharaman is reportedly announcing a comprehensive review of the Income Tax Act of 1961, which will help reduce disputes.
General Anti-Avoidance Rules (GAAR) provisions were applied to the Income Tax Act 1961.

Key Takeaways

This blog includes that taxation law in India is a vast concept that changes whenever new budgets are introduced. Students of the Bachelor of Law LLB program should have enough knowledge of taxation law in India, as it enhances their expertise and prepares them to become professional advisors in law or taxation.

If you want to step into law, you can check out the Manipal University Jaipur website for more details on different programs offered by the university. You can also explore placements at MUJ to make a better decision.