Brief History of Income-tax in India

Ancient Indian Texts like Manusmriti and Arthasastra have elaborated upon
taxation and using tax revenue to build the nation was not a concept alien to
Indians.
In India ,Income-tax was introduced for the first time in 1860, by Sir James
Wilson who was the Financial Member in the Council of India,formed in
order to meet the losses sustained by the Government on account of the First
War of Indian Independence in 1857.Thereafter ,several amendments were
made in it from time to time.
In 1886,a separate Income tax act was passed. This act remained in force up
to, with various amendments from time to time. In 1918, a new income tax
was passed and again it was replaced by another new act which was passed in
1922.This Act remained in force up to the assessment year 1961-62 with
numerous amendments. The Income Tax Act 1961 has been brought into force
with 1 April 1962.It applies to the whole of India and Sikkim(including Jammu
and Kashmir).Since 1962 several amendments of far-reaching nature have
been made in the Income Tax Act by the Union Budget every year
Budget of India and Contribution of Direct Taxes -1947 Scenario
The first Finance Minister of Independent India Shri RK Shanmukham Chetty
presented the first budget of Independent India. Total expenditure under the
budget was earmarked at Rs 197.39 crore.
The First budget of India estimated that the normal revenue of the Union
under direct taxes may be taken as Income-tax and Corporation Tax
constituting 100 crores, Business Profits Tax 15 crores and Capital Gain Tax 3
crores. This gave a total of roughly 243 crores from the three main heads of
revenue.
During the period 1950-51 The maximum rate of personal taxation was about
78 per cent.

Direct Tax Collection Today

The Gross collection of Direct Taxes(before adjusting for refunds) for the F.Y.
2020-21 stands at Rs. 12.06 lakh crore. The provisional figures of Direct Tax
collections for the Financial Year 2020-21 show that net collections are at Rs.
9.45 lakh crore. The net Direct Tax collections include Corporation Tax (CIT) at
Rs. 4.57 lakh crore and Personal Income Tax(PIT) including Security
Transaction Tax(STT) at Rs. 4.88 lakh crore. The net Direct Tax collections
represent 104.46% of the Revised Estimates of Rs. 9.05 lakh crore of Direct
Taxes for the F.Y. 2020-21.

Income Tax Day

Income tax was introduced for the first time in India on July 24, 1860, by James
Wilson to compensate for the losses incurred by the British regime during the
first war of independence against British Rule. Income Tax Department decided
in 2010 to mark July 24 as the day for the annual celebration to mark 150 years
of this levy from that year onwards. 2021 marks the 161st Income Tax Day.