Tax free state of india: The season to file tax is going on. The entire country is currently busy filling income tax returns (ITR). However, today we are going to tell you about a state of the country, where people have been exempted from this. That is, people here do not have to pay tax. Let us know why the citizens here have been given this special status?

People of this state do not have to pay tax

Under the Civil Income Tax Act, 1961 of India, every citizen of the country is responsible for paying income tax. However, the original inhabitants of the state we are talking about here are exempted from payment of income tax under Section 10 (26AAA) of the Income Tax Act, 1961. The state we are talking about here is Sikkim. People here do not have to pay tax.

After all, why did you get exemption from income tax?

Sikkim was established in 1642 and according to the Indo-Squint Peace Agreement in 1950, Sikkim became a protected state of India. Under this agreement, there were some conditions of the original inhabitants there for the inclusion of Sikkim in India.

A condition was also laid that the residents of Sikkim would never have to pay tax. In 1975, Sikkim became a part of India completely, then the conditions of income tax exemption on the people of Sikkim were implemented. Keeping this in mind, under Section 10 (26AAA) of the Income Tax Act, the original inhabitants of Sikkim have been exempted from income tax.

All records are recorded in this register

By the way, the people of Sikkim have been getting tax exemption since 1950 because Chogyal, the ruler of Sikkim, had approved Sikkim Tax Manule in the year 1948 at that time. It is believed that before becoming a part of India, the record of old residents settled in Sikkim is recorded in the register made under the Sikkim subjects regulation.

Earlier this law was limited to only those who had a certificate of being a citizen of Sikkim and a certificate of being descendant. He was later considered a citizen of India under the Sikkim Citizenship Amendment Order, 1989. The 95 percent population of Sikkim has been freed from taxes after the Supreme Court has given the status of natives of Sikkim to the Indian people living in Sikkim till 26 April 1975 (one day before Sikkim’s merger in India).

Section 10 (26AA) was added to the Income Tax Act, 1961, the day the Income Tax Act came into force in Sikkim. The purpose of Section 10 (26AAA) is to reduce the taxpayers burden by giving tax exemption, so despite the change in the tax slab, Finance Minister Nirmala Sitharaman did not change any law regarding tax in Sikkim in Sitharaman.

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