Sunday, February 06, 2005

Budget time nears

The budget nears and the papers are all over town with speculations, conjectures, sneak peeks and surmises all disguised as analysis. The major reform expected this year according to these is in Tax.
TAX is a dirty three letter word in India.
Income tax is paid by a small portion of honest tax payers in India, with the rich and super rich usually protected. Like the proverbial spider web, it catches all the small flies with unfailing regularity while the big birds fly through it with impunity.
Last budget saw a neat footnote that "all taxpayers would have to disclose spending over 50,000 rupees". The mantra seems to be the communist "Milk the existing tax payers because the ones who pay tax are the rich and they should be taxed further". Reality is quite the pposite. The trader hardly pays any tax since he doesnt bill his entire purchases. The doctor hardly pays any tax since he barely issues a bill for any of his patients (Some Bangalore doctors charge you differently if you want a bill or if you dont).
Ditto for the medical shop owner.
Farmers (no, please get rid of the poor farmer image for this post) with crores of assets do not pay taxes. Industrialists, with their access to tax havens do not pay taxes. So who is left? The honest middle class tax payers. Yes, the honest tax payer is is ready to be sent through the juicer again. Squeeze the last drop (plus surcharge and cess) so that politicians can thrive on the "leakages" that "exist" in the system.

2 comments:

Venks said...

Pretty Taxing Article..very true tho...I will wait for ur blog tht teaches me to avoid taxes..:)

Neelakantan said...

Get rich is all I can say ;)