Tax system of UK, USA , India - slides by Simon (BUBT)

8/4/2019 Tax system of UK, USA , India - slides by Simon (BUBT)

http://slidepdf.com/reader/full/tax-system-of-uk-usa-india-slides-by-simon-bubt 1/41

Tax system and

procedure in different countries (USA, UK,

India)



India)

No. Name ID No.

01. Simon Haque 018

02. Rubel Rana 012

03. Tanzia Afroz 050

04. Sabiha Binte Hasan 17905. Munia Anwar 006

06. Fardushi Sultana 016



Taxation in the United States is a complexsystem includes local government, possiblyincluding one or more of municipal, township,district and county governments.

http://en.wikipedia.org/wiki/Local_government

http://en.wikipedia.org/wiki/Municipal_government

http://en.wikipedia.org/wiki/Township_(United_States)

http://en.wikipedia.org/wiki/Political_divisions_of_the_United_States

http://en.wikipedia.org/wiki/Counties_of_the_United_States

http://en.wikipedia.org/wiki/Counties_of_the_United_States

http://en.wikipedia.org/wiki/Political_divisions_of_the_United_States

http://en.wikipedia.org/wiki/Township_(United_States)

http://en.wikipedia.org/wiki/Municipal_government

http://en.wikipedia.org/wiki/Local_government



# Colonial Times

# The Post Revolutionary Era # The Civil War

# The 16th Amendment

# World War I and the 1920's # World War II

# Developments after World War II

# The Evolution of Social Security and Medicare # The Tax Reform Act of 1986

# The Bush Tax Cut



#Assistant Attorney General for Tax

Division#Deputy Assistant Attorney General for

Policy and Planning

>Office of Legislation, Policy and Management

>Office of Training and Career Development

>Office of Management and Administration



#Deputy Assistant Attorney General for CriminalMatters

>Northern Criminal Enforcement Section>Southern Criminal Enforcement Section

>Western Criminal Enforcement Section>Criminal Appeals and Tax Enforcement Policy Section

#Deputy Assistant Attorney General for Review andappellate

>Civil Appellate Section>Office of Review

#Deputy Assistant Attorney General for Civil Matters>Central Civil Trail Section>Eastern Civil Trail Section

>Northern Civil Trail Section>Southern Civil Trail Section>Southwestern Civil Trail Section>Western Civil Trail Section>Court of Federal Claims Section



Alternative minimum tax(AMT).

U.S. capital gains tax.

Corporate income tax.

U.S. estate tax. U.s. excise tax.

U.S. federal income tax.

Federal unemployment tax.

FICA tax (including socialsecurity tax& relatedprograms).

Gasoline tax.

Generation skipping tax.

Gift tax.

IRS (Internal Revenueservice) penalties.

Local income tax. Luxury taxes. Property tax.

Real estate tax. Recreational vehicle tax. Rental car tax. Resort tax. Road usage taxes.

School tax. State income tax. State unemployment tax

etc.



Alternative Minimum Tax ( AMT ) is part of the Federal income tax

system of the United States.There is an AMT for those who owe personal income tax, and

another for corporations owing corporate income tax.



AMT Exemption Amounts

1986-1992

1993-2000

2001-2002

2003-2005

2006 2007 2008 Only2009

MarriedFiling

Jointly

40000 45000 49000 58000 62550 66250 69950 70950

Single orHead ofHousehold

30000 33750 33750 40250 42500 44350 46200 46700



Social security tax formally known as the Federal Insurance and Contributions Act (FICA). This contribution or tax is

6.2% of an employees' income paid

by the employer, and 6.2% paid by

the employee ( 12.4% total).



Local government usually collectproperty taxes but may also collectcity and county tax. Some cities

collect income tax on not onlyresidents but non-residentsemployed in the city. This tax can

even be incurred when a non-resident works temporarily in thecity.



In the United States, the federalcorporate income rate for the year

2006 varies between 15% and 39% depending on taxable income.

But for “Check the box system” many corporations are now able toavoid this tax.



It is generally imposed on thecorporations but also individuals.

In 2003, this rate was reduced to

15% , and to 5% for individuals .

But within 2010 this rate will be at

least 20%.



Capital Gains Taxation in the United States from 2003 forward

2003-2007 2008-2010 2011-OrdinaryIncomeTax Rate

Short-termCapital

GainsTaxRate

Long-termCapital

GainsTaxRate

Short-termCapital

GainsTaxRate

Long-termCapital

GainsTaxRate

OrdinaryIncomeTax Rate

Short-termCapital

GainsTaxRate

Long-

term

CapitalGains

Tax Rate 10% 10% 5% 10% 0% 15% 15% 10%

15% 15% 5% 15% 0%



Corporate tax or company tax refers to a tax imposed on entities that are taxed at the entity level in a particular

jurisdiction.

Rates: Federal 15% to 35%.

States:0%

to10%



The Medicare tax funds the Medicareprogram, a health insurance program for

the elderly and disabled. 1.45% of the

employee's income is paid by theemployer as Medicare tax, and 1.45%

is paid by the employee.

For Self-Employed people, Medicare

taxes are fixed at 2.9% on all earnings

(can be offset by income tax provisions.)



To calculate the property

tax, the authority will multiply the assessed

value of the property by the mill rate and then divide by 1,000 .



The federal telephone excise tax

is a statutory federal excise taximposed under the InternalRevenue Code in the United

States under 26 U.S.C. § 4251 onamounts paid for certain

"communications services."



U.S. States with a flat rate personal income tax

The following states have a flat rate personalincome tax:

Colorado- 4.63% Illinois - 3%

Indiana - 3.4%

Massachusetts - 5.3%

Michigan- 4.35%

Pennsylvania - 3.07%

Utah- 5%



MarginalTax Rate

Single Married Filing Jointly or Qualified Widow(er)

Married Filing Separately

Head of Household

10% $0 – $8,375$0 – $16,750 $0 – $8,375 $0 – $11,950

15%$8,376 – $34,000 $16,751 – $68,000 $8,376 – $34,000 $11,951 – $45,550

25%$34,001 – $82,400 $68,001 – $137,300 $34,001 – $68,650 $45,551 – $117,650

28%$82,401 – $171,850 $137,301 – $209,250 $68,651 – $104,625 $117,651 – $190,550

33%$171,851 – $373,650 $209,251 – $373,650 $104,626 – $186,825 $190,551 - $373,650

35%$373,651+ $373,651+ $186,826+ $373,651+



Partial History ofU.S. Federal Marginal Income Tax Rates

Since 1971

Applicable

Year Income

brackets First

bracket Top

bracket Source 1971-1981 15 brackets 14% 70% IRS 1982-1986 12 brackets 12% 50% IRS

1987 5 brackets 11% 38.5% IRS 1988-1990 3 brackets 15% 28% IRS 1991-1992

3 brackets

15%

31%

IRS

1993-2000 5 brackets 15% 39.6% IRS

2001 5 brackets 15% 39.1% IRS 2002 6 brackets 10% 38.6% IRS

2003-2009 6 brackets 10% 35% Tax Foundation

T U S F d l i l i t t f 1913 t 2009



Top U.S. Federal marginal income tax rate from 1913 to 2009.

http://en.wikipedia.org/wiki/File:MarginalIncomeTax.svg



Rank State Gross collections

(2007) Population (2007) Revenue per

capita 1 California $313,998,874,000 36,553,215 $8,590.18 2 New York $244,672,914,000 19,297,729 $12,678.84 3 Texas $225,390,904,000 23,904,380 $9,428.85 4 Florida $136,476,423,000 18,251,243 $7,477.65 5 Illinois $135,458,089,000 12,852,548 $10,539.40 6 New Jersey $121,678,423,000 8,685,920 $14,008.70 7 Pennsylvania $112,368,286,000 12,432,792 $9,038.06 8 Ohio $105,772,774,000 11,466,917 $9,224.17

http://g/MS%20word%20&%20powerpoint/Taxation%20assignment%20-%20Copy/USA/Federal%20tax%20revenue%20by%20state%20-%20Wikipedia,%20the%20free%20encyclopedia.htm

http://en.wikipedia.org/wiki/California

http://en.wikipedia.org/wiki/New_York

http://en.wikipedia.org/wiki/Texas

http://en.wikipedia.org/wiki/Florida

http://en.wikipedia.org/wiki/Illinois

http://en.wikipedia.org/wiki/New_Jersey

http://en.wikipedia.org/wiki/Pennsylvania

http://en.wikipedia.org/wiki/Ohio

http://en.wikipedia.org/wiki/Ohio

http://en.wikipedia.org/wiki/Pennsylvania

http://en.wikipedia.org/wiki/New_Jersey

http://en.wikipedia.org/wiki/Illinois

http://en.wikipedia.org/wiki/Florida

http://en.wikipedia.org/wiki/Texas

http://en.wikipedia.org/wiki/New_York

http://en.wikipedia.org/wiki/California

http://g/MS%20word%20&%20powerpoint/Taxation%20assignment%20-%20Copy/USA/Federal%20tax%20revenue%20by%20state%20-%20Wikipedia,%20the%20free%20encyclopedia.htm



The Institute of Indirect Taxation is a

professional body in the United Kingdom.

Its members specialize in the study and

practice of indirect taxes. The body was

formed in July 1991 and formally launched

in October 1991. It gained permission to

call itself an institute in December of thesame year. It operates as a company limited

by guarantee.



Rate Dividend

income

Savings

income

Other income

(inc

employment)

Band (above

any personal

allowance)

Lower rate N/A 10% N/A £0 - £2440applies only if

total income falls

in this band Basic rate 10% 20% 20% £0 - £37,400 Higher rate 32.5% 40% 40% over £37,400 Additional

rate N/A 50% 50% over £150,000



Estate duty was replaced in 1975 byCapital Transfer Tax, which wasrebranded Inheritance Tax (IHT) in

1986. Partly due to the simple andwidely-used methods which areavailable to avoid it, Inheritance Tax

accounts for about 0.8% of governmentincome, raising around £2 billion in 2001and £3.6 billion in 2006.



The third largest source ofgovernment revenues is value

added tax (VAT), charged at17.5% (due to increase to 20%

in January 2011) on supplies ofgoods and services.



Capital gains are subject to

tax at the 18% (forindividuals) or at theapplicable marginal rate of

corporation tax (forcompanies).



The Central Board of Direct Taxes constituted under theCentral Boards of Revenue Act, 1963 (54 of 1963),

Directors-General of Income-tax or Chief Commissioners

of Income-tax,

Directors of Income-tax or Commissioners of Income-tax

or Commissioners of Income-tax (Appeals),

Additional Directors of Income-tax or

Additional Commissioners of Income-tax or

Additional Commissioners of Income-tax (Appeals),



Joint Directors of Income-tax or Joint Commissioners of

Income-tax.

Deputy Directors of Income-tax or Deputy Commissioners

of Income-tax or Deputy Commissioners of Income-tax

(Appeals),

Assistant Directors of Income-tax or Assistant

Commissioners of Income-tax,

Income-tax Officers,

Tax Recovery Officers,

Inspectors of Income-tax.



Short-term Capital gains tax Long-term capital gains tax

Sale transactions of securitieswhich attracts STT:- 10% NIL

Sale transaction of securities

not attracting STT:- Individuals (resident and non-

residents) Progressive slab rates 20% with indexation;

10% without indexation (for

units/ zero coupon bonds)Partnerships (resident and non-

resident) 30% Individuals (resident and non-

residents) 30%

Overseas financial organisationsspecified in section 115AB 40% (corporate)

30% (non-corporate) 10% FIIs 30% 10% Other Foreign companies 40% 20% with indexation;

10% without indexation

Local authority 30% Co-operative society Progressive slab rates



Description Existing Rate (%) Proposed Rate (%) Difference + - =

(%) Domestic Company

Regular Tax 33.6 33.9 +0.33

MAT 11.22

(of book profits) 11.33

(of book profits) +0.11 DDT 14.025 16.995 +2.97

Foreign Company Regular Tax 41.82 42.33 0.41



Domestic Corporate Income Taxes Rates Tax Rate Effective Tax Rate

with surcharge

Domestic

Corporations 30% 30%



Foreign Companies Tax Rates Withholding Tax

Rate for non-treaty

foreign companies Tax Rate for US

companies under the

treaty Dividends 20% 15%

Interest Income 20% 15% Royalties 30% 20%

Technical Services 30% 20% Other Income 55% 55%



Category Rates Tax on long-term capital gains 20 %

Tax on winnings form lotteries, crossword puzzles, races etc.

40% Tax on any other income

a) domestic company

b) foreign company

35%

48%



Excise duty rate on items currently attracting 4% to be

raised to 8% with following major exceptions:

Specified food items including biscuits, sharbats, cakes and pastries

Drugs and pharmaceutical products falling under Chapter 30

Medical equipment

Certain varieties of paper, paperboard and articles.

Power driven pumps for handling water

Footwear of RSP exceeding Rs.250 but not exceeding Rs.750 per

pair Pressure cookers

Vacuum and gas filled bulbs of RSP not exceeding Rs.20 perbulb

Compact Fluorescent Lamps

Cars for physically handicapped etc.



Name of Income Rate Dividend 20% Interest received on loans made in

foreign currency to an Indian concern

or Government of India.

20% Income received in respect of units

purchased in foreign currency 20%

Royalty fees or technical fees For Agreements entered into:

After 31.05.97 but before 01.06.05- @ 20%

After 01.06.05 - @ 10%

Interest on FCCB 10%



#Domestic companies are permitted todeduct dividends received from otherdomestic companies in certain cases.

#Inter Company transactions are honored ifnegotiated at arm's length.

#Special provisions apply to venture fundsand venture capital companies.

#Long-term capital gains have lower taxincidence.

#There is no concept of thin capitalizationetc.

Tax system of UK, USA , India - slides by Simon (BUBT)

Documents

Transcript of Tax system of UK, USA , India - slides by Simon (BUBT)