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Revision as of 02:15, 3 September 2026


Through the proposed DTC / GST legislations, federal government has acknowledged the need of new revenue system but the proposed new laws apparently appear being even more complicated then this current one.

3 A 3. All individuals spend tax @ 15.00 % of the income over first Rs. 4,00,000/-. No slabs, no deductions, no exemptions, no incentives and no allowances.No distinction in kind and revenue stream.

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But your employer also has to pay 7.65% in the income he pays you for your Social Security and Medicare. Most employees are unaware of extra tax money your employer is paying that. So, between you including your employer, federal government takes about 15.3% (= 2 times 7.65%) of your income. Should you be self-employed you pay the whole 15.3%.

In 2003 the JGTRRA, or Jobs and Growth Tax Relief Reconciliation Act, was passed, expanding the 10% tax bracket and accelerating some on the changes passed in the 2001 EGTRRA.