The Role of Tax Deductions in Shaping Individual Financial Behavior in India

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Analysis reveals tax deductions impact individual savings behavior and financial decisions, suggesting broader social effects.

Tax deductions significantly influence individual financial behavior, motivating savings and investment habits.
Deductions under the Income Tax Act promote disciplined saving, capital formation, and long-term financial planning.
Instruments like the public provident fund and equity linked savings schemes benefit from tax incentives, driving their popularity.
The uneven benefits of tax deductions highlight disparities in financial engagement among different income groups.

Meenaxi Shivappa Madiwalar (2024) studied this question.

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