New FM, new taxes?

It is a part of the folklore of pre-reform India that its tax rates were stratospheric. And it is true that the peak income tax rate of 97.75 per cent in the early 1970s was plain extortionate. But that was not out of line with rates elsewhere: Britain had a peak tax rate of 99.25 per cent during World War II; in the early 1970s it varied between 75 per cent and 90 per cent.

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