NEW DELHI: The government has sought to allay fears over multiple slabs in the proposed new tax regime, which comes with the option of an exemption-free regime with lower rates, saying the move was in line with global practice and meant to ensure better compliance.“We have studied the rates across countries and several of them have five-six slabs, if not more. It is very logical. As long as inequality in the society exists, people have to be taxed at different rates. It’s the standard practice in many countries, developed and developing, from the US to South Africa and Singapore,” revenue secretary Ajay Bhushan Pandey told TOI.The new mechanism proposed in the Budget has six slabs, ranging from 5% to 30%, for various income slabs apart from a surcharge on those earning above Rs 50 lakh annually.While many experts have argued that it makes the maths more complex, government officials maintained that it was a formula-based approach, and dismissed suggestions that it complicates matters for an average taxpayer. Since the regime will be optional, there is another set of taxpayers who will have a different slab and their taxable income will exclude exemptions for investments, standard deductions and allowances such as house rent and leave travel.There have been suggestions that the new regime should have two-or-three slabs but Pandey said it may not be equitable. “How can a billionaire be taxed at the same rate as someone who is at the threshold of joining the tax range?”Besides, tax officials said, there could be scope for evasion in the non-salaried category as individuals may understate their income to stay in the lower bracket. Pandey also dismissed suggestions that tax rates in India were very high, especially when the government did not offer social security and good quality education or healthcare facilities to citizens.“There is a misconception that tax rates in India are very high. There are only 3 lakh people paying over 30% income tax and only 4,000 in the 41-42% range. In China the highest tax slab is 45%. In many states in the US, the rate is 52% and it kicks in at an annual income of Rs 3.5 crore. In Australia , the top slab of 45% kicks in at around Rs 60-62 lakh (AUS $124,000). Also, in many of these countries welloff taxpayers are not eligible for social security benefits.”