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PERCEPTION OF TAX PAYERS ON TAX REGULATION
CHAPTER - I
INTRODUCTION
KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 1

INTRODUCTION:-
British rule in India became established during the 19th century. After the Mutiny of
1857, the British government faced an acute financial crisis. To fill the treasury, the first
Income-tax Act was introduced in February 1860 by Sir James Wilson.
Income tax in India is governed by Entry 82 of the Union List of the Seventh Schedule
to the Constitution of India empowering the central government to tax non-agricultural
income; agricultural income is defined in Section 10(1) of the Income-tax Act,
1961. Income-tax law consists of the 1961 act, Income Tax Rules 1962, Notifications and
Circulars issued by the Central Board of Direct Taxes (CBDT), annual Finance Acts, and
judicial pronouncements by the Supreme and high courts.
The Income Tax Department is the central government's largest revenue generator; total
tax revenue increased from ₹1,392.26 billion (US$17 billion) in 1997–98 to ₹5,889.09 billion
(US$74 billion) in 2007–08. In 2018–19, direct tax collections reported by the CBDT were
about ₹11.17 lakh crore.

NEED FOR THE STUDY
The development of India depends on development of individual and is possible only

through the growth of individual in manner of education and awareness about various things.
People are busy in their busy life, so they did not spare a couple of minutes to grab knowledge
and educate themselves in taxation, tax regulations, and
recent reforms. People as a tax payer do not have much awareness about the basic tax
regulations, taxation guidelines, procedure and allowances that are provided by the
government, importance of tax education with respect to taxpayers, their education and certain
more things. The present study “Perception of Tax payers on Tax Regulation – A Study on
Individual Tax payers in Dharwad” is very much necessary and it is need of the day to
analyses the awareness of taxpayers about its regulations, tax guidelines and problems of tax
payers. Hence, there is an urgent need for conduct a study to know their level of awareness
towards taxation and tax regulations. This regulated area for me to study. Hence, the present
study had been undertaken to fill the gap. This helps the policy makers to protect the tax
payers.

OBJECTIVESOF THE STUDY
1. To study the recent reforms and tax regulation.
2. To evaluate the tax payer’s awareness about the tax regulations.
3. To study the perception of the tax payers in Dharwad.
SCOPE OF THE STUDY
It is essential for every taxpayer to know the tax regulations and ignorance of the
taxation is becoming a big challenge. Protection of the tax payers from any problems relating
to their tax payment is need of the day. Hence, the taxpayers are to be evaluated to know
whether they are aware of tax regulation and problems relating to tax payments. To achieve
the above objective in the present study on the topic entitled “Perception of Tax payers on Tax
Regulation – A Study on Individual Tax payers in Dharwad”I have taken Dharwad town for
the study. The respondents for this project work were individual tax payers, within Dharwad
town. The respondents were administered with a structured questionnaire pertaining questions
related to awareness, problem of tax regulation and reforms.

REASEARCH METHEDOLOGY
Data can be defined as the qualitative or quantitative values of variables. It is one of the
important and a vital aspect of any research studies. The system of collecting data, analyses,
interpretation for research method is known as ‘Research Methodology’. The data collected
for project may be theoretical/practical. This study attempts to know the tax regulations
among the tax payers of Dharwad by collecting primary data as well as secondary data.
1) Primary data: The primary data was collected directly from the questionnaires administered to
a sample of 25 assesses of income taxpayers selected from the Dharwad town through
structured questionnaires.
2) Secondary data: It was collected through text books, various publications of newspapers and
various websites
Sample Design: A total of 25 tax payers were selected randomly from the Dharwad for this
study to analyses awareness level of tax payers of Dharwad town.
CHAPTER SCHEME
First chapter: includes the proposal of introduction to the topic conceptual frame work,
objective of the study, need for the study, research methodology and chapter layout.
Second chapter: includes introduction, the tax structure in india is divided into direct and
indirect taxes, tax compliances, stakeholders, Characteristics, income tax rate and slab for
individual and HUF, Collection of tax, Different heads of tax, Income Tax returns, Income
Tax calculations, types of taxes, advantages of direct and indirect taxes, GST,VAT, excise
duty, custom duty, Important direct taxes imposed in India, direct v/s indirect taxes, E-filing of
tax returns, Self-Assessment

Third chapter: includes the profile of Dharwad district-Socio-Economic Profile Dharwad
District, Taluk wise Hoblies and Villages, Geographical Location and Natural Resources,
Demographic Features of Dharwad District, Industrial profile, Agriculture & Food Processing,
Contribution of Dharwad district to GSDP of Karnataka, General Statistics, Literacy Rate.
Hubli profile-Location, History, Demographics Transport, Famous places.
Forth chapter: is detailed analysis and interpretation of collected data from survey.
Fifth chapter: is the summary of the finding, suggestions, conclusion and reference,
Questionnaire.
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CHAPTER - II
INDIAN TAX SYSTEM –
AN OVERVIEW

INTRODUCTION
India is one of the largest democratic and fastest growing major economies in the world. To
make India a developed economy the contribution of Indian tax system stands first. In order to
make India developed country taxation is paramount. The Tax structure of India is three-tire
federal structure (the union government, the state government and the urban/rural local
bodies) with a complex structure of local authorities. The main taxes/ duties that the union
government is empowered to levy are income tax, customs duties, excise duties, sales tax and
service tax. Indian tax system is still too large, complex and absolute bundle of excise and
sales taxes. Since the last two decades an impressive improvement is found in Indian
economy. In 2018- 19 real GDP at factor cost has been estimated to grown by 8.2 percent and
was accompanied by a relative stability of prices.
Tax is compulsory levy which a government imposes on its citizens to enable to obtain
the required revenue to the economic activities and it is mandatory. Indian taxation system is
one of the major contributors of Indian Economy. Tax is the main source of income to the
Government of India for social welfare schemes. It is generally considered as a civic duty. On
the other hand, taxation is the process of imposing, assessing, collecting and accounting for
taxes the original concept of tax was basically to raise money to meet the expenditure needs of
the government. Tax is much more than a collecting revenue, it is about building accountable
relation between government and citizen. Tax is cost to the taxpayer, be it on an individual /a
corporate body.
Tax payer’s awareness can be described as a method of educating the people about the
whole process of taxation and why they should pay tax. It assists the taxpayers. It assists
taxpayers in meeting their obligations to the government. This means that the primary
existence of tax regulations is to aware and encourage voluntary compliance amongst the
taxpayers. It can be possible through an effective implementation of the tax administration
system which works on tax assessment system. Tax assessment system is of two types one is
Official Assessment System (OAS) and other is Self-Assessment system(SAS). In OAS tax
payer has file his tax return to an Official Assessment System. In OAS whereby, tax payers
are only required to file their annual tax returns. When tax officials’ issues notice of
assessment to tax payers whereas under SAS are required to assess their tax liability and to fil

the tax return properly.
The present study on the topic entitled “Perceptionof Tax payers on Tax Regulation – A
Study on Individual Tax payers in Dharwad” will focus on evaluating the awareness and
perception of tax payers on tax regulations and reforms.
CONCEPT
Tax is defined as ‘a compulsory levy imposed by a government/govt appointed body

(tax authority) on income, expenditure/capital assets, for which the tax payer receives nothing
specific in return’. Higher the revenue leads betterment of an economy.
Tax Payer: A person, whether an individual, partnership, association /any other entity,
required by this ordinance to (1) file return of earning /of net profit/both or(2) pay tax thereon.
Any Indian citizen is liable to pay income tax, if their income exceeds Rs 2.5 lakh(as per
financial year2017-18) he/she will have to pay taxes to the government of India.
According to THE DICTIONARY OF MODERN ECONOMIC Taxation means

“Compulsory levies on private individuals and organisations made by government to raise
revenue to finance expenses on public goods and services and to control the volume private
expenditure in the economy”.


TAX COMPLIANCES
Every taxpayer is required to undertake certain compliances, such as:
● Annual filing of:
o Return of income
o Report of audit under the ITA (if applicable)
o Transfer pricing certificate (if applicable)
● Monthly deposition of withholding taxes
● Quarterly deposition of advance tax
● Quarterly filing of withholding tax return
● Double Taxation Avoidance Agreement (DTAA)

Signed b/w India and another country so that taxpayers can avoid paying double taxes on their
income earned from the source country as well as the residence country.

● Social Security
All employees are required to contribute towards statutory social security contribution funds.
Withdrawal from such funds is possible at the time of termination of employment.
o To exempt international workers from the contributing towards Indian social security funds,
India has entered into Social Security Agreements (SSA) and Bilateral Comprehensive
Economic Agreements (BCEA) with various countries.
o As a result, inbound assignees from countries that have entered into an SSA with India and
hold a Certificate of Coverage (COC) issued by their home-country can claim exemption from
Indian social security contributions.
STAKEHOLDERS
● Central Board of Indirect Taxes and Customs
● Department of Revenue, Ministry of Finance
● Income Tax Department
CHARACTERISTICS OF TAXATION :
Characteristics of a good taxation system maybe formulated from various objectives. The
main characteristics of tax are as follows:
1) Tax is a compulsory payment.
2) Tax is the payment to the government by the people.
3) Element of sacrifice.
4) The aim of tax collection is public welfare.
5) The benefit received is not directly the return of tax.
6) Tax is not the cost benefit.
7) Taxes are paid out of profits/ incomes.
8) The tax is a legal provision.




Income Tax Rate & Slab for Individuals & HUF:

1. Individual (Resident or Resident but not Ordinarily Resident or non-resident), who is of the
age of less than 60 years on the last day of the relevant previous year & for HUF:
Taxable income Tax rate (existing scheme) Tax rate (new scheme)
Up to RS 2,50,000 Nil Nil
Rs. 2,50,001 to RS. 5,00,000 5% 5%
RS. 5,00,001 to rs 7,50,000 20% 10%
Rs.7,50,001 to rs 10,00,000 20% 15%
Rs .1000001 to rs 12,50,000 30% 20%
Rs .12,50,001 to rs. 15,00,000 30% 25%
Above rs. 15,00,000 30% 30%
Resident or Resident but not Ordinarily Resident senior citizen, i.e., every individual, being a
resident or Resident but not Ordinarily Resident in India, who is of the age of 60 years or
more but less than 80 years at any time during the previous year:
Taxable income Tax rate (existing scheme ) Tax rate ( new scheme )
Up to re. 2,50,000 Nil Nil
Rs. 2,50,001 to rs. 3,00,000 Nil 5%
Rs. 3,00,001 to rs. 5,00,000 5% 5%
Rs. 5,00,001 to rs. 7,50,000 20% 10%
Rs. 7,50,001 to rs. 10,00,000 20% 15%

Rs. 10,00,001 to rs. 12,50,000 30% 20%
Rs. 12,50,001 to rs. 15,00,000 30% 25%
Above rs. 15,00,000 30% 30%
Resident or Resident but not Ordinarily Resident super senior citizen, i.e., every individual,
being a resident or Resident but not Ordinarily Resident in India, who is of the age of 80 years
or more at any time during the previous year:
Taxable income Tax rate ( existing scheme) Tax rate ( new scheme )
Up to rs. 2,50,000 Nil Nil
Rs. 2,50,001 to rs. 5,00,000 Nil 5%
Rs. 5,00,001 to rs. 7,50,000 20% 10%
Rs. 7,50,001 to rs. 10,00,000 20% 15%
Rs. 10,00,001 to rs. 12,50,000 30% 20%
Rs. 12,50,001 to rs. 15,00,000 30% 25%
Above rs. 15,00,000 30% 30%
Surcharge:
10% of Income tax where total income exceeds Rs.50 lakh
15% of Income tax where total income exceeds Rs.1 crore
Note: Enhanced Surcharge rate (25% or 37%) is not applicable in case of specified incomes
I.e. short-term capital gain u/s 111A, long-term capital gain u/s 112A & short-term or long-term capital gai

Education cess: 4% of income tax plus surcharge
Note:A resident or Resident but not Ordinarily Resident individual is entitled to rebate under
section 87A if his total income does not exceed Rs. 5, 00,000. The amount of rebate shall be
100% of income-tax or Rs. 12,500, whichever is less. rebate under section 87A is available in
both scheme I.e. existing scheme as well as new scheme.
To know about this optional New Scheme which is optional for individual and HUF
Income tax Tax rate

Up to rs. 2,50,000 Nil
Rs. 2,50,001 to rs. 5,00,000 5%
Rs. 5,00,001 to rs. 10,00,000 20%
Above rs. 10,00,000 30%

Particulars Tax rate (%)

If turnover or gross receipt of company does 25%
not exceed rs 400 crore in th previous year
2018- 2019 . e
If company opted section 115BA ( note 1) 25%
If company opted for section 115BAA (note 2) 22%
If company opted for section 115BAB (note 3) 15%
Any other domestic company 30%

Up to rs. 10,000 10%
Rs. 10,001 to rs. 20,000 20% 22%
Above rs. 20,000 30%
Surcharge:
a) 12% of Income tax where total income exceeds Rs. 1 crore
b) In case of Concessional scheme, surcharge rate is 10%
Education cess: 4% of Income tax plus surcharge

COLLECTION OF INCOME TAX
There are primarily three ways in which the income taxes are collected by the
government:
a) Taxes Deducted at Source (TDS)

b) Taxes Collected at Source (TCS)
c) Voluntary payment by tax payers into designated Banks
DIFFERENT TAXABLE HEADS OF INCOME:
Income taxes are levied depending on the source of income. Following are the five
main income heads from which taxes are deducted.
● Income from salaries: Taxable income that all employees receive from their employer is
categorizes under this head. As per section192 of the Income Tax act, the employer will
withhold taxes if the employees do not come within the taxable brackets. All about tax
deductions and the net paid income are detailed in Form 16 that must be provided by the
employer to the employee.
● Income from Capital Gains: Capital Gains taxation applies to earnings from the sale of capital
assets held by the assessee. Capital assets refer to the properties such as buildings, lands,
bonds, equities, debentures, jewelries, etc. Taxes are levied on the income of the assessee
when such properties are sold.
● Income from House Properties: Income Tax is levied on house property, if the house is given
out on rent by the owner. However, under this head, the property cannot be used for business
or professional purpose.
● Income from Business: As per section 30 to 43D of the Income Tax Act, the profits earned
from business or by providing professional service are considered taxable as per applicable
rates. This income head is also known as “Profits and Gains of Business or Profession”.
● Income from Other Sources: Income from any other sources than the four listed above is

categorized under this head. Some specific income coming under this head is listed below:

Lottery/horse race winnings
Income from dividends
Pension received after the pensioner’s death.
Rental income (other than house properties)
Gifts received
Interest on government securities, debenture, and bonds
INCOME TAX RETURN
Every individual, who has a source of income, regular or irregular, is legally required to
file income tax returns. Even if your income is below the taxable bracket, you should file your
tax returns. There are prescribed forms through which the income is earned by a person and
the income tax paid thereon are informed to the tax authority.
Uses and benefits of filing Income Tax Returns
1. Easy Loan Processing

2. Foreign Travel
3. Carry Forward of Losses
4. Tax Refund
5. Passport application
6. Insurance Claims.
7. Government Tenders
8. High Life Risk cover
INCOME TAX CALCULATIONS
Tax Calculations is done on the annual income of the person and annuals financial
cycle under income tax law starts from 1st April to 31st March of the next calendar year. The
law classifies the years as “previous years” and “assessment year” “Previous year” is defined
as the year in which the income is earned, and “Assessment year” is defined as the year in
which it is charged.
The basics of income tax calculations in India
Income tax in India is filed annually on the basis of “previous year” and “Assessment
year”

Previous year
According to income tax rules, “previous year”, also known as “financial year” begins on 1st
April of the current year and ends on 31st March of the next year. It does not matter in which
particular month you have started earning, the financial year will end on the 31 st March and
the new tax year will end on the 31st march and the new tax year will begin 1st April onwards.
Hence, it becomes necessary to plan your taxes in advance for each financial year.
Assessment year
In simple words, it is the upcoming fiscal year which comes after the previous year and
one has to assess and file her/his income tax returns in the ‘Assessment Year’
Tax Deduction
The following are the various sections of income tax act of 1961, which allows
reductions on one’s taxable income.
TYPES OF TAXES
Taxes consist of direct tax or indirect tax and may be paid in money or as its labour
equivalent (often but not always unpaid labour). Indian taxation System has the following
structure:

Tax is a mandatory fee imposed upon individual or by the central and the state
government to help build the economy of a country by meeting various public expenses.
Taxes are broadly divided into 2 categories- direct and indirect taxes
DIRECT TAXES
It is a tax levied directly on a taxpayer who pays it to the Government cannot pass it
on to someone else. In case of direct taxes (income tax, securities transaction tax, etc.), the
burden directly falls on the taxpayer.
A) INCOME TAX
Any Indian citizen is liable to pay income tax, if their income exceeds Rs 2.5 lakh (as per
financial year2017-18) he/she will have to pay taxes to the government of India. Additionally,
the following entities that generate income are liable to pay direct taxes
The tax payer’s compliance devastating the country considers the acceptance of 84.5%
revenue from taxes. Taxpayers with high taxation awareness will increase the ratio taxpayer
compliance that will influence the states revenue from the tax sector. In addition, as this study
is mainly concerned, other factors can affect the moderating level of taxpayer compliance. If

the taxpayer is aware of the obligation to pay taxes, of course,

the state revenue from taxes will continue to increase because the number of potential
taxpayers tend to grow every year. The awareness of the tax payers on the tax function of the
state found is needed to improve the taxpayer compliance. The awareness and tax perception
are important factors to increase the tax revenue; it is necessary to study the factors that
influence the tax perception intensively, in particular individual taxpayers’
According to Income Tax Act 1961, every person, who is an assessee and whose total
income exceeds the maximum exemption limit, shall be chargeable to the income tax at the
rate or rates prescribed in the Finance Act. Such income tax shall be paid on the total income
of the previous year in the relevant assessment year.
Assessee means a person by whom (any tax) or any other sum of money is payable under
the Income Tax Act, and includes -
a) Every person in respect of whom any proceeding under the Income Tax Act has been taken
for the assessment of his income or of the income of any other person in respect of which he is
assessable, or of the loss sustained by him or by such other person, or of the amount of refund
due to him or to such other person;
b) Every person who is deemed to be an assessee under any provisions of the Income Tax Act;
c) Every person who is deemed to be an assessee in default under any provision of the Income
Tax Act.
A) person includes:
1. Individual
2. Hindu Undivided Family (HUF)
3. Association of persons (AOP)
4. Body of individuals (BOI)
5. Company
6. Firm
7. A local authority and,

8. Every artificial judicial person not falling within any of the preceding categories.
Income tax is an annual tax imposed separately for each assessment year (also called the
tax year). Assessment year commences from 1st April and ends on the next 31st March. The
total income of an individual is determined on the basis of his residential status in India. For
tax purposes, an individual may be resident, non- resident or not ordinarily resident.
B) Resident
An individual is treated as resident in a year if present in India:
C) Non-Residents
Non-residents are taxed only on income that is received in India or arises or is deemed
to arise in India. A person not ordinarily resident is taxed like a non-resident but is also liable
to tax on income accruing abroad if it is from a business controlled in or a profession set up in
India.
B) CORPORATE TAX
A company has been defined as a juristic person having an independent and separate
legal entity from its shareholders. Income of the company is computed and assessed
separately in the hands of the company. However, the income of the company, which is
distributed to it’s shareholders as dividend, is assessed in their individual hands. Such
distribution of income is not treated as expenditure in the hands of company; the income so
distributed is an appropriation of the profits of the company.
ADVANTAGES OF DIRECT TAXES
Direct taxes do have a certain advantage for a country’s social and economic growth. To name
a few,
1. It curbs inflation:

2. Social and economic balance: balance out.

3. Direct Tax is the fairest:
4. Direct Tax is affordable:
5. Direct Tax is easy to estimate:
6. Direct Tax raises revenue for the government:
7. Direct Tax is economical:
INDIRECT TAX
It is a tax levied by the Government on goods and service and not on the income,
profit or revenue of an individual and it can be shifted from one tax payers to another.
Earlier, an indirect tax meant paying more than the actual price of a product brought
or a service acquired. And there was a myriad of indirect taxes imposed on taxpayers. Few
indirect taxes are, custom duty, central excise duty, service tax, sales tax, value added tax etc.
A) GOODS AND SERVICE TAX (GST)
Introduction of GST is a very significant step in the field of indirect tax reforms in
India. By amalgamating a large number of Central and State taxes into a single tax and
allowing set-off of prior-stage taxes, it has mitigated the ill effects of cascading and pave the
way for a common national market.

TYPE OF GOODS / SERVICES RATE OF TAX
All essential commodities 5%
General rate of Tax for other goods 12%
Services 18%
Demerit Goods / Luxurious Goods 28%
B) VALUE ADDED TAX (VAT)
VAT was a multi-stage tax on goods that was levied across various stages of
production and supply with credit given for tax paid at each stage of Value addition. From 1st
July 2017 State level VAT is limited to be imposed on liquor for human consumption.
C) EXCISE DUTY
Central Excise duty is an indirect tax levied on goods manufactured in India. Excisable
goods have been defined as those, which have been specified in the Central Excise Tariff Act
as being subjected to the duty of excise. With the implementation of GST from 1st July 2017,
scope of excise duty is limited to very few products which are not under the purview of GST,
viz, High Speed Diesel, Petroleum products.
D) CUSTOMS DUTY
Custom or import duties are levied by the Central Government of India on the goods
imported into India. The rate at which customs duty is leviable on the goods depends on the

classification of the goods determined under the Customs Tariff. The

Customs Tariff is generally aligned with the Harmonized System of Nomenclature (HSN).
In line with aligning the customs duty and bringing it at par with the ASEAN level,
government has reduced the peak customs duty from 12.5 per cent to 10 per cent for all goods
other than agriculture products. However, the Central Government has the power to generally
exempt goods of any specified description from the whole or any part of duties of customs
livable thereon. In addition, preferential/concessional rates of duty are also available under the
various Trade Agreements.
DIRECT TAXES V/S INDIRECT TAXES
Following are the differences between the two (direct and indirect taxes)
a) Direct taxes refer to taxes that are filed and paid by individuals directly to the government.
Indirect taxes, on the other hand, are taxes that can be transferred on to another entity.
Therefore, the burden of paying it can be put on another person’s shoulders.
b) Direct tax can be evaded in the absence of proper collection of administration. Indirect taxes
cannot be escaped from because these are charged automatically on goods and services.
c) Direct taxes lessen the savings of earners, but indirect taxes encourage the opposite because it
makes products and services more expensive and unaffordable.
d) Direct taxes are imposed only on people that belong to various income brackets. Indirect
taxes, on the other, can be felt by everyone who buys goods and avails services.
IMPORTANT DIRECT TAXES IMPOSED IN INDIA
a) Income Tax- It is imposed on an individual who falls under the different tax brackets based on
their earning or revenue and they have to file an income tax return every year after which they
will either need to pay the tax or be eligible for a tax refund. It is based on one’s income. A
certain percentage is taken from a worker’s salary, depending on how much he earns. The
good thing is

that the government is also keen on listing credits and deductions that help lower one’s tax
liability.
b) Estate Tax- Also known as inheritance tax, it is raised on an estate or total value of money and
property that an individual has left behind after their death. The most common form of
transfer taxes is the estate tax. Such tax is levied on the taxable portion of the property of a
deceased individual, including trusts and financial accounts. A gift tax is also another form
where in a certain amount is collected from people who are transferring properties to another
individuals.
c) Wealth Tax-Wealth tax is imposed on the value of the property that a person possesses.
Property tax is charged on properties like land and building and is used for maintaining public
service like the police and fire departments, schools, and libraries, as well as roads. However,
both Estate and Wealth taxes are now abolished.
d) Entitlement tax- Such type of direct tax is the reason why people enjoy social programs like
Medicare, Medicaid, and Social Security. The entitlement tax is collected through payroll
deductions and is collectively grouped as federal Insurance Contribution Act.
e) Capital gain tax- Such type of tax is charged when an individual sells asset such as stocks, real
estates, or business. The tax is computed by determining the difference between the
acquisition amount and the selling amount
E-FILING OF INCOME TAX RETURNS
E-filing of income tax is understood as successful filing of income tax return through
the internet. The e-governance has developed the concept and strategies of e- filing of income
tax return through the internet. Thus the income tax department has facilitated the taxpayers
with defining the provisions to be followed, which can be filed and how to file the income tax
for the benefit of tax payers as well as the Government. Now there are 92 intermediaries
performing this function in 61 cities throughout India. The e-filing of income tax returns has
its own limitations like, slow processing, frequent crashes etc., but, the government has taken
necessary steps like, employing 5000 unemployed people to perform as tax return preparers
after getting training from NIIT. They will perform in 100 centres in 80 cities across the

country. For the best e-filing, the government is modifying provisions every year for the
convenience of both beneficiaries.
An effective implementation of the tax administration system which works on Tax

assessment system is of two types one is Official Assessment System (OAS)And other is Self-
Assessment system (SAS). In OAS tax payer has file his tax return to an Official Assessment
System. In OAS whereby, tax payers are only required to file their annual tax returns. When
tax officials’ issues notice of assessment to tax payers whereas under SAS are required to
assess their tax liability and to fil the tax return properly.
Information and communication technology (ICT) have been involved in different

sectors. ICT has an impact to improve learning environment and process. With the increasing
number of students and the limitation of placement, a new innovation in learning is required.
Thus, E-learning and E-assessment have been introduced, to offer online courses and
electronic assessment. E-assessment enables the students live in remote areas to have the test
in their homes and helps the teacher to correct the exam and release the marks in short time.
This paper explains the meaning of E-assessment from different opinions and illustrates the
cycle of E- assessment process. Moreover, this paper discusses the advantages and obstacles
of using E-assessment in learning for different domains: student, teacher, institution, and in
education aims.
Since e-learning and e-assessment have been introduced the learning process has
developed. E-assessment has enhanced the measurement of learner outcomes and made it
possible for them to obtain immediate and direct feedback [7]. It is essential to create a system
to assess students, which take into account the educational goals and help students to develop
their skills which will be a useful for the society for long-term E-assessment can have
different forms such as, automatic administrative procedures, digitizing paper-based systems
and online testing that includes multiple choice tests and assessment of problem solving skills
indicated that, E-assessment includes supporting the assessment by using a computer for
example: with web- based assessment tools.

When you match your or reconcile your calculation of TDS deduction with 26AS (form
in which amount of TDS deduction Shown) Is called TDS Reconciliation. When someone
deduct TDS on your income he/she will deposit this deducted amount into govt. account in
your name by your PAN number.
******

CHAPTER - III
PROFILE OF DHARWAD DISTRICT
Dharwad District Profile

District Overview
Dharwad is the second most advanced district and an important business centre in the state.It
is spread across 5 taluks - Dharwad, Hubballi, Kalghatagi, Kundagol and Navalgund. District
is divided into 3 natural regions, viz., Malnad, Semi-Malnad and Maidan.
Taluk- wise Hoblies and Villages
Taluks No. of Hoblies No. of Villages
Dharwad 4 118
Hubballi 3 58
Kalaghatagi 3 87
Kundagol 2 58
Navalagunda 2 58
(Source: Dharwad district at a glance-2014-15. Government of Karnataka.)
Economic Profile
The total Gross District Domestic Product (GDDP) of the district estimated during the
year 2012-13 is Rs. 8,864 crore.
In the year 2012-13, the per capita annual income of the district was Rs.71,865.
Industrial profile
Improved seed varieties, advanced agricultural technology and mechanization provides
real thrust area in this sector.
Well established milk producers’ cooperative societies.
The district has 109 veterinary institutions, 2 livestock breeding farms and one
semen collection center.
It is rich in local varieties of high quality chilli i.e. Dyavanoor local and Byadagi.
District has major trade center at Hubballi.
Floriculture and new crops/herbs of medicinal, aromatic qualities.
Oleoresin production unit for chilli.
Establishing sugar and maize processing factories.
Processing industries in mango, guava, onion and chilli.
Agriculture and Food Processing
Presence of many subsidiary agricultural industries such as spice processing, pickles,
cotton ginning and pressing gives a thrust to this sector.
District has the second highest number of small scale industry units in this sector.
Presence of 3 agro-climatic zones, high end research based agricultural universities and
testing labs, presence of high number of women self-help groups.



Hubli Profile
Hubli and Dharwad are twin cities in the Indian state of Karnataka. harwad form the
Hubli-D
second-largest municipality of Karnataka in terms of area, after capital B angalore and
second
largest city after Bangalore.[1] Hubli–Dharwad makes up for the second largest urban
agglomeration in the state after Bangalore.[2] While Dharwad is the administrative
headquarters, the city of Hubli, situated about 20 km (12 mi) south-east of Dharwad, is the
commercial centre and business hub of North Karnataka. The cities have a single
municipal
corporation called ubli-Dharwad Municipal Corporation.
H Hubli –Dharwad
Twin City
clockwise from top: Karnatak
University, Gate of Dharwad
Fort, Hubli
Airport, Chandramouleshwara
Temple
Country India
State Karnataka
Population
• Twin city 943,857
• Rank India : 52
Karnataka : 2
• Metro 943,857
KLE SOCIETY’s SM COLLEGE AND PG CENTRE FOR COMMERCE, DHARWADPage 44


Population Growth of
Hubli–Dharwad
Census Population %±
1901 81,143 —
1911 91,031 12.2%
1921 100,992 10.9%
1931 124,398 23.2%
1941 143,504 15.4%
1951 196,180 36.7%
1961 248,489 26.7%
1971 379,166 52.6%
1981 527,108 39.0%
1991 648,298 23.0%
2001 786,195 21.3%
2011 943,857 20.1%
Source: Census of India[5]


CHAPTER - IV
DATA ANALYSIS AND INTERPRETATION

4.01 INTRODUCTION
Income Tax is undoubtedly the most important source of revenue for the Indian
government. It is established as an inevitable imposition on the citizen in order to raise funds
for fulfilling the development and defense needs of the country. To make India a developed
economy the contribution of Indian tax system stands first. In order to make India developed
country taxation is paramount.
Data: The present study has included summary of both primary and secondary data as well as
secondary data. Primary data was collected by issuing or circulating a structured questionnaire
to respondents of Dharwad town with respect to the perception on tax regulation. Secondary
data was collected from internet, newspaper, published and unpublished articles, seminars and
conference proceedings and other related websites.
Sample Design: A total of 25 tax payers were selected randomly from the Dharwad town for
this study to analyse awareness level of tax payers of Dharwad town.
Analysis and interpretation:
Data analysis and interpretation is the process of assigning meaning to the collected
information and determining the conclusions, significance and implication of the findings. It
is an important and exciting setup in the process of research. In all research studies, analysis
follows data collection.
According to C. R. Kothari (1989), “The term analysis refers to the computation of
measures along with searching for pattern of relationship that exist among data-groups”.
The aim of the study is to find out the “Perception of Tax Payers on Tax Regulation- A Study
on Individual Tax payers in Dharwad”.

Demographic Profile:
Demographic is defined as statistical data about characteristics of population, such as

age, gender, and income of the people within the population. When the census assembles data
about people’s ages and genders, this is an example of assembling information about
demographics which will influence my topic.
1. Gender : Gender is the range of characteristics pertaining to, and differentiating between,
masculinity and femininity. Depending on the context, these characteristics may include
biological sex. The respondents were asked to indicate their gender group so that I can easily
distinguish between the ratio of the male and female tax payers.
Table No 4.01
GENDER
Particular Frequency Percentage
Male 17 68
Female 8 32
Total 25 100
Source: Primary data (Questionnaries)
Chart No 4.01
Interpretation: From table no 4.01 it is found that 68% per cent of the respondents
are male, and 32% percent of the respondents are female. This shows that the ratio of male tax
payers in dharwad town is more.

2. Age:
The respondents were asked to indicate their age group. The respondents were asked
to choose among four age group categories, viz, 18-25, 25-45, 45-65 and above years.
Table
No.4.02
AGE
18-25 0 0
25-45 8 32
45-65 15 60
ABOVE 65 2 8
TOTAL 25 100
Source: Primary Data (Questionnaries)
, chart no 4.02
Interpretation :
From table no 4.02 and bar chart depicted above, the distribution of the respondents
under study is evidence that among the 25 respondents who answered the questionnaire, more

then 32% of the respondents are of between the age of 25-45 and more then 50% of
respondents are of between the age of 45-65 and it is found that above 65 age are only 2
respondents. By analysing the chart, it can be stated that the highest number of the
respondents fall in the age group 45-65 and the highest tax payers in the Dharwad town.

3. Qualification:
As another element of demographic profile indicators the tax payers in Dharwad were
asked to indicate their qualification and to choose among four qualification categories, viz,
SSLC, Degree/PG, Professional Course, Other.
Table No.4.03
Qualification
SSLC 5 20
Degree/ PG 12 48
Professional Course 7 28
Other 1 4
TOTAL 25 100
Source: Primary Data. (Questionnaries)
chart no 4.03
Interpretation :
From table no 4.03 and chart depicted above, the distribution of the qualification of
tax payers under study is evidence among 25 respondents who answered the questionnaire, 48
percent of the respondents indicated their qualification in the category of Degree/ PG and 20
percent of the respondents have mentioned that they fell in the category of SSLC and 28
percent of the respondents have mentioned that they fell in the category of

professional course and Other. By analyzing the responses of the tax payers and from the
above chart it is identified that most of the tax payers in dharwad are Degree / PG holders.

4. Annual Income:
Gross annual income represents the amount of money a person earns in one year from
all sources before taxes. The respondents to my project have to answer this question because it
will help them and me to know that whether they come under the taxable income range or not.
Table No.4.04
Annual Income
2.5-3 lakhs 3 12
3-5 lakhs 6 24
5 - 10 lakhs 8 32
10 lakhs and above 8 32
TOTAL 25 100
Source: primary data (Questionnaries)
chart no 4.04
Interpretation :
From table no 4.04 and chart depicted above, the distribution of the annual income of
tax payers under study is evidence among 25 respondents who have answered the
questionnaire,32 percent of the respondents said that their annual income is between the
range of 5-10 lakhs (8 respondents) also range of 10 lakhs and above (8 respondents) and 24
percent of the respondents are of above 5 lakhs income. By analyzing the responses of the tax

payers of Dharwad town and from the above chart it can be identify and state that most of the
tax payers of Dharwad town’s annual income is between 4-5 lakhs and there are also respond

dents who earn more than 5 lakhs income.
5. Profession:
A paid occupation, especially one that involves prolonged training and formal
qualification. An act of declaring that one has a particular feeling or quality, especially when
this is not the case. The respondents to my project have to answer this question because it will
help them and me to know that whether they are government employees/ non-government
employee which will help me in bifurcating and analyzing their profession.
Table No.4.05
Profession
Businessmen 5 20
Government Employee 13 52
Non-Government Employee 6 24
Other 1 4
Total 25 100
chart no 4.05
Interpretation :
From table no 4.05 and chart depicted above, the distribution of tax payers under
profession study is evidence among 25 respondents who have answered the questionnaire, 20

percent of the respondents businesmen. 52 percent government employees and 24 percent are
non- government employees.By analyzing the responses of the tax payers

of Dharwad town and from the above it can be identified and state that most of the tax payers
of Dharwad town are government employees and non-government employees.
6. Are you Tax Payer ?
PART - B
Table No. 4.06
Tax Payer

Yes 23 92
No 2 8
Total 25 100
chart no 4.06
Interpretation :
From table no.4.06 and chart depicted ,above distribution of tax payers.92 percent respondents
are yes. and 8 percent respondents are no.

7. Are you aware about income tax act 1961 ?

The Income Tax Act 1961 is applicable in India. In 1956, the government referred the
request to impose Income Tax Act. The law Commission further submitted its report on the
Income Tax Act in 1958 and the same year, Chairman shri Mahavir Tyagi, chaired the Direct
Tax Administration inquiry commission. The Income tax Act, 1961 was introduced to the
public. Since then, it has undergone amendments from time to time. The above question was
asked to know that whether the tax payers in Dharwad are aware about the Income Tax Act or
not because it is very much important to a tax payer to have knowledge about the act and its
regulations.
Table No.4.07
Awareness about Income Tax Act

Yes 24 96
No 1 4
TOTAL 25 100

chart no 4.07

Interpretation :

percent of the respondents are yes , and 4 percent of the respondents are no about the Income
Tax Act 1961.By analysing the responses of the tax payers of Dharwad town and from the
above chart it is identified and stated that most of the tax payers (96%) of Dharwad town are
aware about the Indian Income Tax Act 961.
8. Do you know about various types of taxes?
The above question was asked to know that whether the tax payers in Dharwad are
aware about the types of taxes or not. Because it is very much important to a tax payer to have
a knowledge about the various types and they must know that what all types taxes are there so
individuals can easily pay discharge their duty (payment of tax)
Table No.4.08
Awareness about types of taxes
Yes 24 96
No 1 4
TOTAL 25 100
chart no 4.08
Interpretation :
From table no 4.08 and chart depicted above, the distribution of tax

payers under profession study is evidence among 25 respondents who have answered the
questionnaire, 96 percent of the respondents yes , and 4percent of the respondents are no
about the type of taxes. By analyzing the responses of the tax payers of Dharwad town and
from the above chart it is identified that most of the tax payers (96%) of Dharwad town are
aware about the Indian Income Tax Act 1961 and they should be educated about the various
types of taxes.
9. What is level of awareness about tax regulations?
Tax regulation is basically how the Internal Revenue Service (or state department of
revenue) interprets the tax code. These regulations are the Treasury Department’s official
interpretations of the Internal Revenue Code and are one source of U.s The above question
was asked to know that whether the tax payers in Dharwad are aware about the tax regulation
or not. Because it is very much important to a tax payer to have a knowledge about the
regulations.
Table No.4.09
Level of awareness about Tax regulation
PARTICULAR FREQUENCY PERCENTAGE
Partially Aware 9 36
Fully Aware 10 40
Neutral 6 24
Not Aware 0 0
TOTAL 25 100
chart no 4.09

Interpretation :

percent of the respondents were fully aware, and 36 percent of the respondents are partly
aware about tax regulations. By analyzing the responses of the tax payers of Dharwad town
and from the above chart it is identified that most of the tax payers (40%) of Dharwad town
are fully aware about the Indian Income Tax regulations and it if found that most of tax payers
of Dharwad do not have a full knowledge about tax regulations.
10. What is your taxable income range?
The above question was asked to know about the taxable income range of individuals
income tax payers of Dharwad because it is very much necessary for a researcher to know /
have knowledge about the taxable income range of individuals.
Table No.4.10
Taxable Income Range
2.5-3 lakhs 3 12
3-5 lakhs 6 24
5 -10 lakhs 10 40
10 lakhs and above 6 24
TOTAL 25 100
chart no 4.10


Interpretation :
From table no 4.10 and chart depicted above, the distribution of tax payers under profession
study is evidence among 25 respondents who have answered the questionnaire, 40 percent of
the respondent’s taxable income range is 5-10 lakhs and 24 percent of the respondent’s
taxable income range is 2.5-3lakhs and 3-5lakhs .By analyzing the responses of the tax payers
of Dharwad town and from the above chart it is identified that most of the tax payers (40%) of
Dharwad town fall under the taxable income range 5-10 lakhs.
11. What is the range of your income tax rate?
The above question was asked to check, whether tax payers have knowledge about the tax rate
that they are paying to the government or not and also to check that whether they are paying
the right rate of tax or not.
Table No.4.11
Range of Income Tax Rate
0% 0 -
5% 0 -
20% 10 40
25% 5 20
30% 10 40
TOTAL 25 100

chart no 4.11


Interpretation :
From table no 4.11 and chart depicted above, the distribution of tax payers under is evidence
among 25 respondents who have answered the questionnaire,40 percent of the respondent’s
(10people) range of income tax payment is 20% and 40 percent of the respondent’s (10people)
range is 30%of rate. By analyzing the responses of the tax payers of Dharwad town and from
the above chart it is identified that 50percent of the respondents have correct knowledge about
tax payment and rest of them need to be educated about the tax rate.

12. What is the source of your income?
Source of income means where the money is coming from for an individual. Income
could be from multiple sources such as employment, investment and welfare.for business it
could be from a particular market, products, customers, investments or government grants.
Table No.4.12
Source of Income
Income from Salary 17 68
Income from Business 5 20
Income from House property 1 4
Income from Capital Gain 1 4

Income from Other sources 1 4
TOTAL 25 100
chart no 4.12
Interpretation :
profession study is evidence among 25 respondents who have answered the questionnaire,68
percent of the respondent’s source of income is income from salary and 20 percent of the
respondent’s source is from business. By analysing the responses of the tax

payers of Dharwad town and from the above chart it is identified that most of the tax payers’
source of income is salary (68%).
13. What is the type of tax you are paying?
There are taxes levied directly on a taxpayer who pays it to the Government cannot pass it on
to someone else. For example, Income tax, Capital Gain tax, Property tax and other taxes. The
above question asked to know that what all kinds of taxes the individuals are paying in
Dharwad which will help me in analysing.
Table No. 4.13
Tax payment type
Income Tax 24 96
Property Tax 0 0
Capital Gain tax 1 4
Other Tax 0 0
TOTAL 25 100

chart no 4.13
Interpretation :

percent of the respondents source of income is income from salary and 20 percent of the
respondents source is from business.By analyzing the responses of the tax

payers of Dharwad town and from the above chart it is identified that most of the tax payers
(24 respondents) source of income is salary and business.
14. “Indian income tax provides adequate exemption to the tax payers”.
The above question was asked to check, whether tax payers have knowledge about the tax rate
that they are paying to the government or not and also to check that whether they are paying
the right rate of tax or not.
Table No.4.14
Adequacy of exemption
Strongly Agree 4 16
Agree 17 68
Disagree 0 0
Strongly Disagree 4 16
TOTAL 25 100

chart no 4.14
Interpretation :
From table no 4.14 and chart depicted above, the distribution of tax payers is evidence among
25 respondents who have answered the questionnaire,68 percent of the respondent’s (17
people) agree that Indian Income tax provides adequate exemption to its payers and 16

percent of the people are strongly agree and strongly disagree about the statement.

By analyzing the responses of the tax payers of Dharwad town and from the above
chart it is identified that 68% percent of the respondents agreed that the exemption provided to
them is enough and they are satisfied.

15. “Every tax payer is aware about TDS”
The above question was asked to check, whether tax payers have knowledge about the
TDS (Tax Deducted at Source) or no, and to make them aware about the deduction that they
are allowed.
Table No.4.15
Awareness about TDS (Tax Deducted at Source)

Fully aware 8 32
Neutral 3 12
Not Aware 0 0
TOTAL 25 100

chart no 4.15
Interpretation :
From table no 4.15 and chart depicted above, the distribution of tax payers is evidence
among 25 respondents who have answered the questionnaire,56 percent of the people are just
partially aware about TDS and 32 percent of the respondents are fully aware.
chart it is identified that more than 50% aware about TDS.
16. Rate your knowledge on TDS.
The above question was asked to check, whether tax payers have knowledge about the
TDS (Tax Deducted at Source) or not and to calculate their level of knowledge about TDS
Table No. 4.16
Knowledge on TDS
Very good 3 12
Good 15 60
Neutral 7 28
Bad 0 0
TOTAL 25 100
chart no 4.16
Interpretation :
From table no 4.16 and chart depicted above, the distribution of tax payers is evidence among
25 respondents who have answered the questionnaire,60 percent of the people have good or
enough knowledge about TDS and some of the respondents don’t have any knowledge about
TDS.
chart it is identified that 60 percent of the respondents have good knowledge, and 28 percent

of the respondents are having knowledge about TDS and 12 percent of the respondents are
having knowledge about TDS.

17. Level of awareness about Recent Reforms of Tax.
The above question was asked to check, whether tax payers have knowledge about
recent reforms of tax are not, like GST, self- Assessment, E-Filing etc.
Table No.4.17
Awareness about recent reforms of tax
Fully aware 5 20
Neutral 2 8
Not Aware 1 4
TOTAL 25 100
chart no 4.17
Interpretation :
From table no 4.17 and chart depicted above, the distribution of
tax payers is evidence among 25 respondents who have answered the questionnaire,68 percent
of the people are partially aware about the recent reforms of tax and 20 percent of the
respondents are fully aware about the recent reforms of tax, all of them are bank employees
only. The rest of the people like teachers and businessman are not aware about the recent
reforms of tax they should be educated first.

18. “As a Tax payer I know, how to calculate Taxable income”
The above question was asked among the 25 tax payers of Dharwad to check that does
tax payers know how to calculate their taxable income or not, whether they follow self-
Assessment system, or they depended on consultant.
Table No. 4.18
Calculation of Taxable Income
Strongly Agree 6 24
Agree 17 68
Disagree 2 8
strongly Disagree 0 0
TOTAL 25 100

chart no 4.18
Interpretation :
among 25 respondents who have answered the questionnaire,68 percent of the respondents
said that they know calculations of taxable income, 24 percent of them are strongly agree and
8 percent of the respondents said they do not know how to calculate it.By analyzing the above
table and chart depicted above it is identified that 68 percent of the respondents know how to
calculate their taxable income and 10 percent of the respondents

Have somehow knowledge, and 8 percent of the respondents are not ware about calculations.
19. How do you pay Income Tax?
above question was asked to know the mode of payment of the respondents, whether they pay
through self-Assessment, or through friends or with the help of consultants, or by some other
way.
Table No.4.19
Mode of payment of tax
Consultants 21 84
Friends 0 0
Self-Assessment 4 16
Others 0 0
TOTAL 25 100
chart no 4.19
Interpretation :
said consultants,16 percent said self,
By analyzing the above table and chart depicted above it is identified that 84 percent

of the respondents wholly depend on consultants and most of them are government

employees, and 16 percent of the respondents are known how to make payments, so they are
following self-Assessment system.
20. Are you satisfied with the exemption?

The above question was asked to calculate the satisfaction level of the tax payers in
matter of the exemption.
Table No.4.20
Satisfaction level of exemption
Fully Satisfied 8 32
Satisfied 9 36
Neutral 4 20
Unsatisfied 3 12
TOTAL 25 100

chart no 4.20
Interpretation :
From table no 4.20 and depicted above, the distribution of tax payers is evidence
among 25 respondents who have answered the questionnaire, 36 percent of the respondents
said they are satisfied and 32 percent of the respondents fully satisfied with the exemptions.
And 12percent are unsatisfied with the exemptions.
By analyzing the above table and chart depicted above it is identified that 36 percent
of the respondents are satisfied with the exemptions from the government and 32 percent are
fully satisfied and 20 percent are neutral with the exemptions.
21. How do you get information about tax payment?
the above question was asked to how do you get information about tax payment.
Table No. 4.21

Source of information about tax
Through Consultants 19 76
Media 2 8
Internet 4 16
Other Sources 0 0
TOTAL 25 100
chart no 4.21
Interpretation :
among 25 respondents who have answered the questionnaire, 76 percent of the

respondents said consultants, 16 percent said internet,8 percent said media.
By analyzing the above table and bar chart depicted above it is identified that 76
percent of the respondents get information from their consultants and rest of the respondents
depend on internet, media and another source.
22. Does your Tax Consultant Notify various Tax Provisions ?
the above question was asked to does your tax consultants notify various tax
provisions.
Table No.4.22
Consultant Notify Various Tax Provisions
Always 15 60
Rarely 3 12
Sometime 7 28
Never 0 0
TOTAL 25 100
chart no 4.22


interpretation:
from table no 4.22 and chart depicted above , the distribution of tax payers is evidence among 25 respondents who answered the
questionnaire, 60 percent of the people have always and 28 percent respondents of the people have sometime and 12 percent of the people have
respondents rarely.
23. “The current penalty rate is high”

The above statement was asked to know the perception of the tax payers on penalty
rate. Whether it’s too high for them or they can bear that penalty, or they are okay with the
penalty.
Table No.4.23
Perception on current penalty rate
Strongly Agree 8 32
Agree 15 60
Neutral 1 4
Disagree 1 4
TOTAL 25 100
chart no 4.23
Interpretation :
among 25 respondents who have answered the questionnaire,60 percent
always to some level, 28 percent are sometime and 12 percent rarely. By analysing the above
table and bar chart depicted above it is identified that the tax payers feel, current penalty rate
is high.
24. “I believe that tax collected will be utilised for betterment of nation”
The above question was asked to know the perception of tax payer on utilised for betterment of nation.
Table No.4.24
Perception of utilization of tax
Strongly Agree 4 16
Agree 19 76
Disagree 1 4
Strongly Disagree 1 4
Total 25 100

chart no 4.24
Interpretation :
among 25 respondents who have answered the questionnaire,32 percent said that strongly

agree, 60 percent said agree and 6 percent said that neutral and disagree. By analyzing the
above table and bar chart depicted above it is identified that the tax payers

feel, tax received from the vast public( tax payer’s) will be utilized for the betterment of the
nation.

25. Tax payers are not willing to pay tax.
The above question was asked to know the perception of the tax payers in default of
payment and the reason for not payment of tax.
Table No. 4.25
Reason for default in tax payment
Lack of Awareness 12 48
Lack of Ability to pay 2 8
Negligence 8 32
Intentional 3 12
TOTAL 25 100
chart no 4.25
Interpretation :
among 30 respondents who have answered the questionnaire, 48 percent of the respondents
said lack of awareness, 32 percent said that negligence and 8 percent said lack of ability to
pay. As and 12 percent said intentional. By analyzing the above table and bar chart depicted
above it is identified that the main reason for not paying the tax is lack of awareness about the
payment.

26. “The current laws and regulations are complex”

The above question was asked to know the perception of tax payers on complexity of
the tax regulations.
Table No.4.26
Complexity of tax regulations
Strongly Agree 2 8
Agree 15 60
Disagree 8 32
strongly Disagree 0 0
TOTAL 25 100

chart no 4.26
Interpretation :
among 25 respondents who have answered the questionnaire,60 percent of the respondents are
agree, 8 percent strongly agree, and 32 percent disagree.
By analyzing the above table and chart depicted above it is identified that the tax
regulations are complex to some extent only.

27. “The current tax system is fair”

The above statement was given to the respondents and asked to answer just to evaluate their
perception on fairness of tax system.
Table No. 4.27
Perception on Fairness of tax system

Strongly Agree 5 20
Agree 13 52
Neutral 6 24
Disagree 1 4
TOTAL 25 100
chart no 4.27
Interpretation :
agreed to the statement, 24 percent are neutral, 20 percent strongly disagree the statement and

4 percent are disagree. By analyzing the above table and bar chart depicted above it is
identified that the current tax system is fair

CHAPTER - V
FINDINGS, SUGGESTIONS & CONCLUSION

1. It is found that there are greater number of male tax payers in dharwad town which is 68%
of the total respondents.
2. It is found that 60% of tax payers of dharwad town tax between the age group of 45-65.
3. More than 40% of tax respondents are qualified and they can easily understand tax
regulations.
4. More than 32% of the respondents are having an annual income more than 10lakh and
above lakhs, this signifies that the need for tax payers to have awareness about the tax
regulations, deductions, regulations.
5. From the study it is found that 52% of the respondents are government employees and 24%
of non government employees and rest 20% are businessmen.
6. The study signifies that the '0' of the respondents are not aware of income tax Act and
regulations but partly aware only 36% and fully aware 40%.
7. It is found that among an the respondents more than 50% people tax payable and aware
about different types of taxes.
8. It is found that only 68% of the respondents are aware about the recent reforms of taxes.
9. It is found that among all the respondents more than 50% tax. Payers pay tax on their
income from salary.
10. It is founded that among all the respondents pay the tax only on income from salary as
compared to other sources of income.
11. More than 60% of the respondents are strongly agree regarding that the Indian income tax
provides adequate exemptions to the tax payers. This is positive feedback which motives the
tax payers to avail the exemption benefits.
12. It is found that only 32% of the respondents are aware about the tds.
13. Only 60% of the respondents are having the good knowledge of tds though their tax
deducted from their salary.
14. It is found that more 60% of people have the awareness of the how to calculate taxable
income.
15. It is found that the tax payers highlights that only 16% of tax payers make self assessment
calculations of taxable income.on the other hand, more 80% of the respondents depend upon
consultants for calculations of the income tax.
16. Though the tax payers have knowledge of employees limit and pay tax regularly,12% of
the respondents are not satisfied with the exemption provided by the Indian income tax
department.

17. Majority of the tax payers mainly 20.60% of respondents feel that current tax regulation
are more Complex in the nature and very difficult to understand.
21. more than 70% of the respondents perceive that the collected amount is being utilised for
the betterment of the nation.
.

Suggestions:-
1. the tax payers must have awareness of tax regulations. Because less than 50% tax payer are
fully aware about the tax regulations.
2. the study found that the tax payers must have awareness regarding more about TDS.
3.Thought the respondents feel positive about the adequacy of exemption but they are not
fully satisfied with the exemption provided by ITD there fore the income tax department
should frame exemption brackets keeping the exemptions of the tax payer in mind.
4. it is also suggested for tax payer that to have knowledge of exemption limit,deduction
available, taxable income range, tax rate.
5. The income tax department should help every individual tax payer to get information about
the various things relations to the tax by making effective use of the technology available or
from any other sources which will reach individual easily like news paper,advertisement
thought audio visual media,announcement,circular ets.
5.It is suggested to the indian income tax department that to keep their rules of regulation Ease
and simply that every individual can understand easily without any difficulty.
KLE SOCIETY’s SM COLLEGE AND PG CENTRE FOR COMMERCE, DHARWADPage

100
CONCLUSION
Tax payer’s perception on the tax regulations and other tax matters impacts very much
on the tax department activities. Tax payer’s awareness can be described as a method of
educating the people about the whole process of taxation and why they should pay tax. It
assists taxpayers in meeting their obligations towards the government. The main objective of
the project is to evaluate the perception and awareness of the tax payers of Dharwad, to study
the recent reforms of taxes and also to make suggestions to the tax payers to have knowledge
of tax rates, reforms, deductions, exemptions etc.
to achieve the objectives, I had taken 25 individual tax payers of Dharwad as a sample.
A separate structured questionnaire was administered to the respondents which was focused
on knowledge of tax regulations, awareness of individual, perception of tax payers, reforms of
taxes etc. using provisions given by the income tax department. The data was analysed using
the statistical tools and techniques, tables, graphs, measure of central tendency etc. it was
identified that majority of the tax payers are not aware of the Income Tax Act and regulations,
reforms, types of taxes, TDS self-Assessment etc though, they are paying income tax
regularly. it is also found the tax payers are not satisfied with the exemptions, tax rates,
penalty etc.
So, to overcome from this difficulty it is advised to the tax payers that they must
have awareness about the Income tax Act and regulations, different types of taxes TDS self-
Assessment etc. because they are making the tax payments regularly. To make such payments
one should have enough knowledge about the tax and its regulations. The Income Tax
Department should help every individual tax payer to get information about the various things
relating to the tax by making effective use of the technology available or from any other
source which will reach every individual

101
person easily And should take a dynamic step towards the

defaulters of tax payments and make sound and rigid rules
against the defaulters, late payments, errors in calculations etc.,
and also IT department should reduce the current tax rate and
penalty rate so that every individual can enjoy their exemptions
and payments. It is suggested to the Indian Income Tax
Department that to keep their rules and regulations ease and
simple that every individual can understand easily without any
difficulty.
It is essential for every taxpayer to know the tax
regulations and ignorance of the taxation is becoming a big
challenge. Protection of the tax payers from any problems
relating to their tax payment is need of the day.
*******
BIBLIOGRAPHY:
WWW.investindia.gov.in
income tax in india –Wikipedia
e- krishiuasb.karnataka.gov.in
en.m.wikipedia.org
www.hostbooks.com

102
QUESTIONNAIRE
Dear sir /madam,

I am pleased to introduce myself as Miss. Chaitra putanikar , M.com
Final year student of K L E `s SHRI MRITYUNJAYA COLLEGE OF ARTS
AND COMMERCE AND PG CENTRE FOR STUDIES IN COMMERCE,
DHARWAD .
As a part of my project work , I solicit your valuable opinion on the
topic entitled “ perception of tax payers on tax regulation – A Study on
individual tax payers in Dharwad.” I request you to spend your valuable time to
provide information by answering the following question given below. I assure
you that the information will be used only for academic purpose and will be
maintained confidential.
Thanks for your valuable time and positive response.
Yours faithfully
(Chaitra Putanikar)
________________________________________________________________
PART – A
DEMOGRAPHIC PROFILE
1) Name of the Tax Payer
2) Gender : Male Female
3) Age :
a) 18 – 25 c) 45 – 65
b) 25 – 45 d) 65 and above
4) Qualification :
a) SSLC c) Degree / PG
b) Professional Course d) Other
5) Annual Income :

103
PERCEPTION
a) 2.5 – 3 lakhs OF TAX PAYERS ON
c) TAX
5 – 10REGULATION
lakhs
b) 3 – 5 lakhs d) 10 lakhs
6) Profession :
a) Businessmen c) Non – Government Employee
b) Government Employee d) Other
PART - B
7) Are you a Tax Payer ?
a) Yes b) No
8) Are you aware about the income tax Act, 1961 ?
a) Yes b) No
9) Do you know about the various types of taxes ?
a) Yes b) No
10) What is your level of awareness about the tax regulation ?
a) Partially aware c) Neutral
b) Fully aware d) Not aware
11) What is your taxable income range ?
a) 2.5 – 3 lakhs c) 5-10 lakhs
b) 3 – 5 lakhs d) 10 lakhs and above
12) What is the range of your income tax rate ?
a) 5% c) 25%
b) 20% d) 30%
13) What is the source of your income ?
a) Income from Salary d) Income from capital gains
b) Income from business e) Income from other source
c) Income from house property
14) What type of tax you are paying ?
a) Income tax c) capital gain tax
b) Property tax d) Other taxes
15) “Indian Income tax provides adequate exemption to the tax payers.”
a) Strongly agree c) Disagree
b) Agree d) Strongly disagree
16) Every tax payer is aware about TDS.
a) Fully aware c) Neutral
b) Partially aware d) Not aware
17) Rate your knowledge on TDS

104
PERCEPTION
a) Very good OF TAX PAYERS ON
c) TAX REGULATION
Neutral
b) Good d) Bad
18) Level of awareness about Recent Reforms of tax.

a) Fully aware c) Neutral
b) Partially aware d) Not aware
19) “As a tax payer I know how to calculate taxable Income.”
b) Agree d) Agree
20) How do you pay income tax ?
a) Consultants c) Self assessment
b) Friends d) Other
21) Are you satisfied with the Exemptions ?
a) Fully satisfied c) Neutral
b) Satisfied d) Unsatisfied
22) How do you get information about tax payments ?
a) Through consultants c) Internet
b) Media d) Other Source
23) Does your tax consultant notify various tax provisions ?
a) Always c) Sometime
b) Rarely d) Never
24) “The current penalty rate is high”
a) Strongly agree d) strongly disagree
b) agree
c) disagree
25) “I believe that tax collected will be utilized for betterment of nation”
b) Agree d) Strongly disagree
26) Tax payers are not willing to pay tax (Reason)
a) Lack of awareness c) Negligence
b) Lack of ability to pay d) Intentional
27) “The current tax laws and regulations are complex.”
b) Agree d) Strongly discharge

105
28) “The PERCEPTION
current tax system inOF TAX PAYERS ON
fair.” TAX REGULATION
a) Strongly agree c) Neutral
b) Agree d) Disagree
*****

106

107

108

109

110


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PERCEPTION OF TAX PAYERS ON TAX REGULATION

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 1

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 2

The development of India depends on development of individual and is possible only

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 3

SCOPE OF THE STUDY

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 4

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 5

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 6

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 7

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 8

Tax is defined as ‘a compulsory levy imposed by a government/govt appointed body

According to THE DICTIONARY OF MODERN ECONOMIC Taxation means

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 9

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 10

● Double Taxation Avoidance Agreement (DTAA)

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 11

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 12

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 13

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 14

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 15

Income Tax Rate & Slab for Individuals & HUF:

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 15

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 16

Income tax Tax rate

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 17

Particulars Tax rate (%)

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 18

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 19

COLLECTION OF INCOME TAX

a) Taxes Deducted at Source (TDS)

DIFFERENT TAXABLE HEADS OF INCOME:

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 20

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 21

Lottery/horse race winnings

Income from dividends

Pension received after the pensioner’s death.

Rental income (other than house properties)

Interest on government securities, debenture, and bonds

INCOME TAX RETURN

1. Easy Loan Processing

INCOME TAX CALCULATIONS

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 23

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 24

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 25

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 26

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 27

An individual is treated as resident in a year if present in India:

ADVANTAGES OF DIRECT TAXES

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 28

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 29

A) GOODS AND SERVICE TAX (GST)

KLE SOCIETY’S SMC AND PG CENTRE OF COMMERCE COLLEGE, DHARWADPage 30

TYPE OF GOODS / SERVICES RATE OF TAX

All essential commodities 5%

General rate of Tax for other goods 12%

Demerit Goods / Luxurious Goods 28%

B) VALUE ADDED TAX (VAT)