It may be advisable to raise the exemptiom limit for making Tax administration better due to reduced assesses. However, this goes against the basic principle of a wide Tax payers base.
The ideal thing would be to reduce tax rates as it is a universally accepted fact that lower rates result in better compliance. This has already been proved in India also with the booming tax revenues. Alongwith lowering rates, govt should concentrate on recovery of old tax dues, make Income Tax law simpler for better compliance and concentrate on bringing in tax net the large fish which are hoodwinking the departement despite enormous incomes and spending. Another step that needs to be taken is to bring large agricultural income in tax net.
