A Wealth Tax also known as ‘Taxing one’s riches’ was a popular direct tax which was levied on individuals, HUFs and companies whose net wealth exceeded Rs 30 lakhs on the valuation day. For the purpose of its calculation, only specified assets were taken into account. Such as:
Finance Minister Arun Jaitley while announcing Budget 2015, abolished the tax now has been completely removed from financial year 2015-16 onwards. The loss of revenue will be now compensated by the levy of additional surcharge on the higher income earning assesses.
The Wealth tax has been swapped with a higher tax on the super rich in India. An additional surcharge of 2% is now levied on the income exceeding ?1 crore of:
The strategy will help the government to achieve its objective of bringing more persons under tax net as people who file returns under normal income tax act are much higher than those who file under the wealth tax and to remove any scope of taking undue advantage of the loopholes of wealth tax.