Agricultural Income tax

What does the term Agricultural Income mean? land , income derived from land, store house.

Income earned from carrying nursery operations is also considered as agricultural income and hence exempt from income tax.

Certain income which is treated as Agriculture Income: Certain income which is not treated as Agricultural Income:
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Certain points to be remembered; (a) Agricultural income is considered for rate purpose while computing tax of Individual/HUF/AOP/BOI/Artificial Judicial Person. (b) Losses from agricultural operations could be carried forward and set off with agricultural income of next eight assessment years. (c) Agriculture income is computed same as business income.

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Subsidies
Effects of Subsidies: 1. Allocative effect 2. Redistributive effect 3. Fiscal effect 4. Trade effects

Two major conventions relate to measurement through (i) Budgets. The estimates of budgetary subsidies are computed as the excess of the costs of providing a service over the recoveries from that service. (ii) National Accounts. The latter estimates comprise explicit subsidies, and certain direct payments to producers in the private or public sectors that are treated as subsidies.
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Calculatio n

The subsidy (S) in a service is obtained by:

S = RX + (d + i) K + i ( Z + L ) - ( RR + I + D ) Where:

RX = revenue expenditure on the service L = sum of loans advanced for the service at the beginning of the period K = sum of capital expenditure on the service excluding equity investment at the beginning of the period. Z = sum of equity and loans advanced to public enterprises classified within the service category at the beginning of the period.

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