LAND UTILIZATION Land is a scarce resource, whose supply is fixed for all practical purposes. At the same time, the demand for land for various competing purposes is continuously increasing with the increase in human population and economic growth.Land use pattern at any given time is determined by several factors including size of human and livestock population, the demand pattern, the technology in use, the cultural traditions, the location and capability of land, institutional factors like ownership pattern and rights scale regulation. Major Types of Land Utilization in India : As in all other countries, land in India is put to various uses. The utilization of land depends upon physical factors like topography, soil and climate as well as upon human factors such as the density of population, duration of occupation of the area,land tenure and technical levels of the people.There are spatial and temporal difference in land utilization due to the continued interplay of physical and
PROPORTIONAL TAX
These are those taxes whose rates remain uniform irrespective of size of income.
Example : if tax is 10% ,then person with rupees 500 as his income will pay rupees 50 and person with rupees 1000 as his income will pay rupees 100 as tax.
Sales tax, excise duty are its example.
Merits
a) Progressive tax is simple and every body cab understand without any difficulty.
b)It can be easily decided and enforced.
c)It enjoys advantage of certainty . Both tax payer and stare are certain about the amount of tax.
d)It maintain existing distribution of income and wealth of country.
e)It is advocated when authorities are unable to decide proper degree of progression.
f)It leave taxpayer in same relative economic status as he was before the tax is imposed.
g)It does not adversely affect people's desire to work and save.
Demerits
a)It does not result in equitable distribution of burden of taxation. Poorer makes much greater sacrifice than the richer.
b)It does not reduce inequalities of income and wealth.
c)The government cannot get much revenue due to low rate of tax.
d)It is not elastic also.
PROGRESSIVE TAX
These are those tax which increase with the increase in income. Higher the income,higher will be the tax.
Example:The tax rate may be 10% for income 5000 rupees , 15% for 10000 rupees , 20% for 15000 rupees. Thus the amount of tax will be 500 rupees, 1500 rupees,3000 rupees for respective incomes.
Income tax in India is its example.
Merits
a)progressive tax are in accordance with principle if equity . These are decided on the basis of ability to pay.
b)These are justified on the ground that higher income have surplus above cost . Therefore ability to pay for higher income group is high .
c)These are favoured on the basis of law of diminishing marginal utility. Thus implies that MU of money to rich is low as compared to poor . Thus taxing the rich at higher rate and spending this money on poor will tend to maximise welfare of society.
d)These reduce the inequality of income and wealth and lead to equitable distribution.
e)These are economical as their cost of collection does not increase with the increase in tax rates.
f)These are elastic as government can collect more funds by raising Rate if tax on rich.
g)These provides income to the state which increases with the increase in economic activity in country.
h)Through these , the purchasing power can be increased by lowering tax rate and cam be reduced by raising tax rates during depression or boom period.
Demerits
a)These discourage capital accumulation. The people with savings if taxed heavily their saving potential will reduce.
b)Under this , thrift and hard work are punished while laziness and extravagance are encourage.people who are hard work ,squires wealth with their own ability and save it ,are taxed more whereas those who are lazy remain tax free.
c)These are arbitrary because their it no standardized method to fix it's degree.
d)These are based on assumption thay marginal utility is less to rich . But ,utility is subjective which cannot be measured.
e)There is possibility of evasion also. A person has to pay high tax as his income increases which creates a desire in him to evade tax.
f)This is applicable to only few taxes .
g)There is need of resources which make it inadequate to enforce.
REGRESSIVE TAX
In a regressive tax , the rate of tax falls with the increase in income.
Example: Sales tax on wheat .
Merits
a)It is easy to calculate.
b)Every citizen pays same amount of tax.
c)There is less disparities in income.
d)There is no requirement of professional.
Demerits
a)It is socially unjust.
b)It yields little revenue to the government.
c)Tax burden is higher in poor sections.
d)It is against public interest.
DEGRESSIVE TAX.
It is mildly progressive up to a certain limit , but after that it becomes proportional. Under this , the rate of tax increases with the increase in income up to a certain limit.
Merits
a)The Progressivity is meant to promote social justice.
b)It is mixture of proportional and progressive tax.
c)Higher income groups make less sacrifice.
d)It's application is found in Indian income tax.
Demerits
a)It can lead to income inequalities.
b)It places financial burden in low income groups.
c)It causes people to spend less money , which further leads to decreased economic activity.
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