Abstract

Agriculture supports survival of nearly 40–50% population of maharashtra. Majority of the farmers have marginal operational holdings. But rich farmers with large operational holdings are earning huge income. The state government has not exploited the tax potential of agricultural income from the state. Several research studies have concluded that provision of liberalized subsidized inputs is benefiting mainly this section of farmers. It is argued that state government should not miss the opportunity to levy tax on their incomes and should attempt targeted provision of subsidies in the current scenario of continuously rising fiscal deficits. Exploitation of agriculture income tax to its optimum potential will increase the capacity of the government to help the poor and needy farmers.

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