Tax Laws in India are dynamic – with frequent amendments and updates. In 2020, the new tax regime for Income Tax was introduced with lower tax rates but with fewer deductions and exemptions. The standard deduction for salaried individuals was increased from ₹40,000 to ₹50,000 though. The Dividend Distribution Tax (DDT) was abolished and dividends are now taxed in the hands of the recipient. Also, Tax Deducted at Source (TDS) was introduced for e-commerce operators.

And who can forget the Goods and Services Tax (GST)? GST rates have been revised multiple times to simplify the tax structure, and e-invoicing was introduced for businesses with a turnover exceeding a specified threshold to streamline the GST compliance process. Also, the GST annual return filing process was simplified with the introduction of GSTR-9C (self-certification reconciliation statement).

The Corporate Tax saw some changes too. The corporate tax rate was significantly reduced to 22% for existing companies and 15% for new manufacturing companies. Also, the Minimum Alternate Tax (MAT) was reduced from 18.5% to 15%.

Besides, additional tax deductions were introduced for interest paid on home loans for affordable housing, the faceless assessment was introduced to make the tax assessment process more transparent and efficient, and the Vivad se Vishwas Scheme was introduced to resolve tax disputes between taxpayers and the tax department.

Tax laws in India impact everyone – from individuals to businesses. These frequent changes in these tax laws present both a challenge and an opportunity for commerce students at SMS Varanasi. If you understand the complexities of tax laws well, you can prepare for a rewarding career in taxation. 

In this guide, we will talk about how you to make a career in taxation.

How to gain a thorough understanding of the Tax Laws in India?

B.Com, B.Com (Hons), and M.Com students at SMS Varanasi cover the core concepts of the Indian tax system in their curriculum. We advise you to focus on:

• Direct Taxes: The intricacies of the Income Tax Act of 1961, and the concepts of taxable income, deductions, exemptions, and tax rates applicable to individuals, Hindu Undivided Families (HUFs), firms, and companies are some of the important topics you should cover well.
• Indirect Taxes: The Goods and Services Tax (GST) laws are important. You should also know about the different GST rates, the input tax credit mechanism, and compliance procedures.
• International Tax: The principles of international taxation, including double taxation avoidance agreements (DTAA), transfer pricing regulations, and the taxation of cross-border transactions are crucial for businesses dealing with international transactions.
• Tax Administration: The procedural aspects of tax administration, including tax return filing, assessment procedures, appeals, and dispute resolution mechanisms can help everyone – from individuals to businesses.

Go through textbooks and reference materials on tax laws to get detailed explanations, case studies, and practical examples to help you understand complex concepts. Active participation in class and asking questions are the easiest and quickest ways to clarify your doubts. Trust your professors!

When it comes to tax laws, textbooks can never be enough. Tax laws in India keep evolving, so make it a habit to follow official notifications and amendments issued by the government. Some of the best resources to read about changes in tax laws are:

• The official website of the Income Tax Department,
• The Central Board of Indirect Taxes and Customs (CBIC) Website for information on GST laws, regulations, notifications, and circulars, and
• Reputable Tax Publications, such as The Chartered Accountant Journal (CA Journal), International Taxation Journal, and Taxmann.

Elective Courses Commerce Students Should Choose to Make a Career in Taxation

B.Com students interested in a career in taxation are advised to choose Income Tax Law and Accounts in Semester 4. Fundamentals of Entrepreneurship can also be beneficial in understanding business creation/operation and prove to be valuable if they want to be tax advisors or consultants one day.

In Semester 5, they should choose Business Finance for a solid understanding of how tax laws impact businesses. Goods and Services Tax (GST) is a core component of the Indian tax system and you must study it thoroughly.

When it comes to minor electives, we would advise you to focus on Computerised Accounting in Semester 2, Strategic Management in Semester 4 (where tax considerations often play a role), and International Business in Semester 5.

Vocational courses, such as E-Taxation in Semester 4, and Data Analysis using Excel & SPSS in Semester 5 can prove to be highly useful in the future.

B.Com (Hons) students looking to master tax laws in India should pay special attention to core subjects like Financial Accounting in Semester 1 and Corporate Accounting in Semester 3 where they learn the basics of tax calculations. For major elective courses, they should choose Income Tax in Semester 5 and Goods and Services Tax (GST) in Semester 6.

Minor elective courses B.Com (Hons) students interested in tax laws might find useful are:

• Management Sciences in Semester 1 to understand organisational structures and decision-making processes that can help with tax consulting,
• Supply Chain Management & Logistics in Semester 3 to understand GST implications on the movement of goods and services, and
• Digital Marketing in Semester 4 so that you can promote your tax firm adequately online.

Vocational Courses like Tally & Computerized Accounting in Semester 1, Data Analysis through SPSS in Semester 2, and Business Analytics & Data Science in Semester 4 can teach you skills that are highly desirable in the tax field.

M.Com students who want to specialise in taxation should focus on core courses like Accounting for Planning and Control in Semester 2 and Accounting for Managerial Decisions in Semester 3. Some other courses, postgraduate Commerce students should focus on are:

• Managerial Economics in Semester 1 to understand the economic context in which tax laws operate,
• Financial Management in Semester 2 to gain a deeper understanding of financial statements and how they relate to tax compliance and planning, and
• Advanced Statistical Analysis in Semester 3.

In Semester 4, students should choose M.Com specialisations, such as Accounting and Finance Group, Security Analysis and Portfolio Management, and International Finance and Financial Services.

Minor elective courses, such as Business Management in Semester 1 can help with understanding business operations and structures (to advise clients better), and Business Environment & Legal Aspects of Business in Semester 3 to understand the broader context of tax laws and their impact.

Conclusion

As a commerce student, understanding tax laws is not just an academic pursuit; it’s a stepping stone to a fulfilling career. Choose your electives wisely, gain practical experience, and stay updated on the latest changes to become a tax expert.