A COMPARATIVE STUDY OF INDIAN TAX POLICIES WITH GLOBAL TAX SYSTEMS

Abstract

This study explores the intricacies of Indian tax policies in relation to various global tax systems, providing a comprehensive analysis of similarities, differences, and the underlying motivations behind these frameworks. Tax policies are pivotal for any nation, influencing revenue generation, economic growth, and social equity. India, with its unique economic landscape and diverse population, has developed a complex tax structure that combines direct and indirect taxes, reflecting its developmental goals and regulatory challenges. The research begins with a historical overview of Indian tax policies, highlighting key reforms such as the liberalization in the 1990s and the introduction of the Goods and Services Tax (GST) in 2017. These reforms aim to simplify the tax regime, enhance compliance, and broaden the tax base, positioning India as an attractive destination for investment. A comparative analysis is conducted with major global tax systems, particularly those of the United States, European Union countries, and emerging economies in Asia. The study delves into direct and indirect taxation, compliance mechanisms, and international agreements such as Double Taxation Avoidance Agreements (DTAAs). It examines the effectiveness of India's tax incentives, transfer pricing regulations, and digital taxation frameworks in light of global best practices. The findings indicate that while India has made significant strides in aligning its tax policies with international norms, challenges remain in areas such as compliance, the informal economy, and administrative efficiency. The study concludes by offering insights into potential reforms that could enhance India's tax system, emphasizing the need for a balanced approach that fosters economic growth while ensuring fairness and equity. Overall, this comparative study serves as a valuable resource for policymakers, researchers, and stakeholders seeking to understand and improve India's tax landscape in a global context.