Agriculture Income: Agriculture income means any income derived by cultivation from any land or building in a country like Bangladesh, India, etc., and used for agriculture purposes. As a country develops economically, the relative importance of agriculture declined. This income is considered for rate purposes while ascertaining the income tax liability of an individual. For example, if a family’s income were to increase by 100 percent, the amount it would spend on food might increase by 60 percent; if formerly its expenditures on food had been 50 percent of its budget, after the increase they would amount to only 40 percent of its budget. It is a vital sign as it gives information on the feasibility of the agricultural sector and is accurately taken into account in discussions on policy perspectives. It follows that as incomes increase, a smaller fraction of the total resources of society is required to produce the amount of food demanded by the population.
Characteristics if Agriculture Income: Analysis of definition, nature and case decisions relevant to agriculture income, following may be defined as the characteristics of agriculture income –
- It must come from agricultural land. Basic operations comprise of cultivation which included different activities that are performed using human skill and have an effect on the land.
- It must come from fundamental agricultural work. Any income is attributable to a farmhouse which is required for operations for agriculture.
- The marketing of products used by farmers will be a normal procedure. Any process by the owner of the land who receives the rent in a non-monetary way or the cultivator that results in agricultural products which can be taken to the market to be sold.
- Such income may arise from adjacent agricultural land. By sale of the produce of the agricultural land.
- Income may also arise from a sale or discarded value of agricultural machines or plants. The building has to be situated close to the land and is required as a warehouse or as a house for residential purposes.
- Such income may come from such items which may partly agricultural and partly non-agricultural.
- Agricultural income may also arise in cash i.e., annual rental value.
Elements of Agriculture Income
According to Income Tax Ordinance (ITO), 1984 the following income will be considered agriculture income. They are shown below –
- Selling from crops.
- Means of agriculture.
- Agriculture co-operative society.
- Income from marketing agricultural products.
- Income from leasing the land.
- Income from the building adjacent to the garland.
- Income from selling palm and date juice.
- Income from selling honey.
- Income from poultry firm.