Question

When income tax increases from 4% to 5%, tax liability of a person increases by 10%?

Answer 1

Because income tax is charged with respectively to rates at different slabs..for eg if a person earns an income of 9995000per annum..and he pays 5 and 10%rates on two slabs..but if his income increases by 4 or 5% ..it will take him to next slab (above 1cr)then he has to start paying surcharge that is 12%