The present chapter is devoted to the introductory issues relating to the role of Direct tax laws in the development of International Business. Focus has also been laid on the need to present a hospitable environment for encouraging foreign investment and to protect the revenue base of the nation. The chapter has been classified on the following lines.

1.1 Introduction

1.2 Indian Tax Structure

1.3 Basic Principles Of International Taxation

1.4 International Business: Concepts, Scope And Structure

1.5 Need For International Business

1.6 Review Of Existing Studies

1.7 Statement Of The Problem

1.8 Objective Of The Study

1.9 Scope Of The Study

1.10 Limitations

1.11 Hypothesis

1.12 Research Methodology1.1 INTRODUCTION

Rapid economic development happens to be one of the primary objectives of all developing economies and India is not an exception. This is possible mainly through the accumulation and proper use of capital. The developing economies lack adequate basic infrastructural facilities. In order to develop these, the government takes upon itself the responsibility for building up capital formation, through sound taxation policies.

India is a mixed economy. Liberalization, privatization and globalization have further strengthened the role of tax policy in economic development. Both the public and the private sectors have to play an important role in ensuring satisfactory growth rate. For this, the government has to work out and provide adequate avenues for raising funds by private enterprises. This envisages the need to provide adequate incentives, rebates and reliefs in the form of tax deductions to stimulate the private sector. Here again a sound tax policy and a robust tax structure is inevitable. In order to accomplish the above objectives, the government enacted the Income Tax Act, 1961 repealing the act of 1922.

The present Act has realized due weight age of taxation of International Business which has assumed much importance to the tax collector as well as to the tax payers.