For a massive population of 135 crore people, India is the most populous country growing at an unprecedented rate. To put that in simple number form, in 1947, India was some 350 million strong and in 72 years has grown 4 fold. That’s an addition of over 1 billion people.
By no measures does poverty increase population. It decreases it. Therefore, it’s safe to assume that Indians find a way to produce and feed their large populace.
Another stark statistic is the Indian tax payer base. For a population of 135 Crore, we have an abysmal 6 Crore people registered under income tax and some 1.2 crore GST registrations. However, of the 6 crore taxpayers, less than half are in the taxable bracket. That’s less than 3 crore people or about 2% of our population. In contrast, USA has over 42% of its population as taxpayers.
A recent experiment ‘demonetization’ was thought to bring in a lot of taxpayers. Unfortunately, the resultant statistics has not been very encouraging therefore showing that the parallel economy in India, albeit one which exists, is mainly limited to the millions of small enterprises and farming community who are not educated enough to use the banking system or don’t trust banks.
Another aspect to consider is that if a small taxpayer base exists, the wealth is obviously concentrated with an extremely small percentage of people. from recent statistics there are about 170,000 people in India who earn more than a Crore a year. This lopsidedness is what causes great angst amongst those who don’t have the ability to create wealth.
So if this wealth gap exists, is it necessary to ‘burden the taxpayer’?
It’s because of the taxpayer that the country runs. The taxes pay all the government employees, gives the ability for the politicians to give so many sops to the poor, builds infrastructure and many other things. To flog a taxpayer to pay more is no different from ancient times when a ship rowers were flogged to row faster.
Many innovative and deeply socialist schemes are being drummed up to unhinge the taxpayer. Retrospective taxation is one of them where things are being opened up from one era, the recent National Green Tribunal (NGT) ruling (on drains and nalas) focused on one geography was terrifying to millions of homeowners as the judgement literally rendered over 90% of people in Bangalore homeless, military laws which create setbacks from their properties (After acquiring more land than they need) to render lakhs of acres of private land worthless (even trees cannot be grown). There are many such instances to quote which continue to baffle the intelligent mind. However, when the government is acquiring lands in vote bank areas and metros, the courts are silent about compensation made. For example, when the Metro-rail acquires land, they pay 4 times the market price in cash to the landowners. The same when roads are being built. There is also the Transferable Development Rights (TDR) or alternative land swap route which have been followed in some cases.
Just think for a moment, if you bought a home with all documentation as per the existing law and along came a government agency and cooked up a new law, for just Bangalore City (which is curious), and retrospectively your home was demolition worthy, how would you feel? You have to regardless of this high handed thoughtless law pay the EMI to the bank and in effect this law has made you a pauper.
The sad part is that these laws are one sided targetting the taxpayer. After-all the taxpayer pays the ‘SALARY’ of the lawmaker so it’s only apt for the lawmaker to burden the taxpayer. Like the classic adage “Bite the hand that feeds you”
The taxpayers money goes into projects where there is little or no engineering study with the help of experts, both international and local, to find ways execute a perfect project. Take for example Amsterdam and Singapore. Their waterways are used as a tourist attraction whereas in India, our waterways are non-existent and there is no plan to develop them keeping the future in mind. There are no laws made to ensure that the Indian government makes proper waterways under a National scheme which ensures that if private land is affected, there should be compensation to ensure that the owner of property does not face hardship as a result of these harsh one sided laws. Also, roads are built to last in other countries but in India, its built for six months so that public money can be continuously looted.
In developed countries, one would not mind paying higher taxes as they have social security, fabulous infrastructure and a well maintained environment. In India, there is no social security, so if an honest taxpayer hits a bad patch, god bless the poor guy as he has nothing to fall back on and the government will turn a blind eye.
Unfortunately, as the politics lacks leaders with deep insight and education and we keep promoting mediocrity, industry is not going to grow rapidly to increase the tax payers base from the current levels to even 12 Crore. In the past 6 years, the addition of taxpayers is just an addition of number from a quantitative sense but not a qualitative one. While the tax payers base grew from some 5 crores to the current level, the real taxpayers are less than 2 Crore individuals. The need is for qualitative increase and not a quantitative one which only is to hoodwink people into believing that there is some magic happening with more numbers. Until then, the burden falls upon a small group of people to toil hard for a highly populated country.
Raj Kaushik – Vitarkka