India’s Outdated Tax Code: Single Earners Bear Burden as Global Joint-Filing Models Ignored

India’s income tax framework, often criticized as complex and burdensome, is facing fresh scrutiny over its individual filing requirements and limited provisions for dependents. Unlike countries like the U.S. and the U.K., where married couples can file taxes jointly to optimize benefits, India mandates separate filings for each individual, regardless of marital status. This has sparked debates about whether the system disproportionately burdens single earners supporting multiple dependents, with some critics labeling the approach as “tax terrorism.”  

Global Practices vs. Indian Norms  

In the U.S., married couples can choose to file jointly, combining incomes and deductions to reduce their overall tax liability. Similarly, the U.K. offers a “marriage allowance,” permitting spouses to transfer a portion of their tax-free allowance to each other. These systems recognize household income as a collective unit, easing the burden on primary earners.  

In contrast, India’s Income Tax Act requires spouses to file separately, even if one partner earns no income. This becomes particularly challenging in households where a single individual supports children, elderly parents or other relatives. While India allows limited deductions for dependents (e.g., ₹50,000 per senior citizen parent under Section 80DD), critics argue these provisions are inadequate compared to the actual cost of living and care.  

Dependency Pressures and “Tax Terrorism” Allegations

The term “tax terrorism” — often used by business leaders and opposition parties to describe aggressive tax enforcement and compliance demands — has resurfaced in discussions about individual taxpayers. Middle-class professionals, especially sole breadwinners, report feeling overburdened by audits, lengthy refund processes and a lack of flexibility in accounting for dependents.  

“My salary supports my parents, my wife and two children. Yet, the tax system treats me as an individual entity, ignoring my responsibilities,” said Ravi Mehta, a Mumbai-based IT professional. “Countries like the U.S. acknowledge familial dependencies but here, even after reforms, the system feels punitive.”  

Government Defends System, Points to Reforms  

Revenue Department officials have pushed back against the “tax terrorism” label, citing recent digitization efforts, reduced corporate tax rates, and the optional new tax regime (introduced in 2020) that lowers rates in exchange for forfeiting deductions. “India’s tax system is progressive and responsive. We’ve simplified processes through faceless assessments and automated refunds,” said a senior official, speaking anonymously.  

However, tax experts argue that structural issues remain. “The individual filing system ignores household economics. A working mother paying for childcare gets no tax breaks while a U.S. household might claim credits for the same expense,” said Delhi-based economist Anjali Verma.  

Calls for Holistic Reform  

Advocates urge India to adopt family-based taxation or expand dependency allowances. “A joint filing option could reduce the burden on single earners and better reflect India’s family-centric culture,” said tax consultant Arvind Kumar. Others propose increasing deductions for childcare, elderly care, and education.  

While the 2023 Union Budget introduced minor relief for senior citizens, broader reforms remain absent. With India’s taxpayer base expanding — from 57 million in 2014 to over 89 million in 2023 — pressure is mounting to modernize the system.  

As India aims to become a $5 trillion economy, balancing revenue needs with taxpayer fairness will be critical. For now, the debate underscores a growing demand for a tax regime that aligns with global practices while addressing the realities of dependency in a rapidly changing society.