USA HISTORY

Detailed explanation-1: -Currently, farmers in India are exempted from paying income tax to the government. Is agricultural income fully exempt from tax? Under Section 10(1) of the Income Tax Act, 1961, any income generated from any agricultural activities are exempted from being taxed by the Government.

Detailed explanation-2: -As per section 10(1), agricultural income earned by the taxpayer in India is exempt from tax.

Detailed explanation-3: -Taxes on agricultural income falls under Entry 46 in ‘State List’ under the Constitution of India. Thus, only the State Governments are competent to enact legislations for taxation of agricultural income and levy income tax. Thus, farmers who have no other sources of income are not required to file income tax returns.

Detailed explanation-4: -There are around 150 million Indians involved in the agricultural sector. At an average of six family members per household, that translates into 900 million Indians dependent on farming. Only 60 million assessees currently file tax returns.

Detailed explanation-5: -The tax imposed on crops was fixed at one-sixth of what was produced and was known as Bhaga or a share. It was the most important tax as most of the people were farmers.