Awareness of Tax Saving Schemes among Individual Assessees: Empirical Evidence from Twin City of Odisha

Government has to play an important role in all round development of society and country as a whole. Taxes constitute the main source of finance whereby government raises revenue for public spending. In India, income-tax contributes up to 52.28%(AR 14–15 MOF) to the total tax revenue of the central government. Because of compulsion element, each tax-payer faces the problem of how to find golden way to minimize their tax liability. But paying tax is always a painful task as it directly impacts on the residual income of the taxpayers. So all individuals always try to reduce tax liability by managing their financial affairs. Tax planning is important for every assessee to reduce their tax liability and compliance with the income tax rules. To enjoy the benefits of tax planning, the assessee must know different provisions of tax saving schemes available in the laws. The primary objective of this paper is to assess the awareness of tax saving schemes by individuals of twin city of Odisha.i.e Cuttack and Bhubaneswar. The study reveals the fact that only 23% respondents are having good knowledge, followed by 42% having average knowledge and 34% of respondents have very poor knowledge about tax saving schemes.