Why❓Agriculture income are not taxable in India

Описание: 🌾 Why Agricultural Income is Not Taxable in India —

Agricultural income in India is exempt from income tax. This exemption is not random; it comes from a mix of constitutional provisions, historical reasons, and economic policy goals.

1. Constitutional Reason — Who Has the Power to Tax Agriculture?

(A) Agriculture is a “State Subject” – NOT a Union Subject

Under the Constitution of India, powers are divided between the Union Government and State Governments using:

Union List

State list



Agriculture appears in the State List

This means: 👉 Only State Governments can make laws regarding agriculture and agricultural land, including taxation.
👉 The Central Government has no constitutional power to tax agricultural income.

Relevant Entry:

Entry 46, State List (List II) – “Taxes on agricultural income”.

Summary

Agricultural income is not taxable in India primarily because

1. Constitutional Reason:
Agriculture is a State List subject; therefore, the central government cannot tax agricultural income (Entry 46 of State List).

2. Historical Reason:
Farmers were historically poor and overtaxed; exemption was given to support rural India after independence.

3. Economic & Social Reason:
Agriculture supports a large population and is risky, so taxation would hurt poor farmers.

4.Political Reason:
Farmers form a huge voting base; states avoid taxing them.