!DOCTYPE html> Tax Pert | Income tax rates moderate in India | A Tax Consulting Site

India is seen to have lower tax rates than several other countries, an internal analysis by the finance ministry has shown. It has also pointed to the country's low tax-GDP ratio, something which may not cheer those who are looking forward to tax relief in Finance minister Arun Jaitley's third budget to be presented on 29 February 2016.

 
For instance India's tax to GDP ratio is at 16.7%, well below China's 19.4% and USA's 25.4%. France has a tax to GDP ratio of 45% while Denmark as is pegged at 48.6%, data available with the finance ministry showed. India's tax GDP ratio is closer to the levels in Ghana (16.1%) and Tanzania (16.8%).


Among the BRIC countries, Brazil has a tax to GDP ratio of 33.4% while Russia is at 34.8%. But experts say that most developed countries have a higher per capita income and therefore the ability to pay higher taxes.


In terms of tax rates the lowest individual tax rate in India is 0%, in China it is 5% and in the United States it is 0-3%. In the United Kingdom it is pegged at between 0-20%.