Difference Between Tax and Tax Evasion

'Tax Planning' and Tax Evasion' 1. 

Tax planning is an Act within the four corners of the Act to achieve certain social and economic objectives and it is not a colourable device to avoid the tax. 

Tax evasion is a deliberate attempt on the part of taxpayer by misrepresentation of facts, falsification of accounts including downright fraud.

 2. Tax planning is a legal right and a social responsibility. By tax planning certain social and economic objectives are achieved. Tax evasion is a legal offence coupled with penalty and prosecution. 

3. Tax planning requires thorough knowledge of the relevant Acts, social, cconomic and political situation of the country while tax evasion requires boldness to infringe the law. 

4. Tax planning helps in economic development of the country by providing additional funds for investment in desired channels while tax evasion generates black money which is generally utilised for smuggling, bribery, extravagant expenses on luxury. 

5. A tax planner enjoys his fruits freely and he does not suffer from high blood-pressure, whereas a tax evader remains always in anxiety of search and seizure. As our society has become 'money society', whatever the evils of black money may be, it has become a part of the life of most of the people and in near future there is no hope of putting a check on