Wealth Tax

Hello buddy provide me details on Wealth Tax Act and why the wealth tax has been abolished?

Wealth Tax Act, 1957 governs the taxation process associated with the Net Wealth of an Individual, a Hindu Undivided Family (HUF), or a Company possesses on the Valuation Date.

The Reserve Bank of India is exempted from paying Wealth Tax though the entity fulfils the requirement of being a corporation in India. It is an Act that provides for the levy of Wealth Tax on liable Assessees and came into force on April 1, 1957.

Citation
Act No. 27 of 1957

Enacted
Parliament of India

Date commenced
1 April 1957

Reasons behaind Wealth Tax been abolished
Focus on more governance and less government
Simplification of tax procedures
Incurs high collection costs but provides low yiel
Increase the revenue collection
Additional administrative burden:
Tax compliance and widening the tax base
Additional reporting
No leakage
Low Awareness

Wealth Tax Limits
Investment securities viz. shares, bonds, units of mutual funds, units of gold deposit schemes
Houses/plots of area below 500 sq. Mts
Houses as place of business/profession
Residential properties rented out for 300 days or more in a year
Vehicles for hire
Stock-in-trade business assets

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Answered By StudyChaCha Member