Need to review the taxation system in India and possibly elsewhere

@vandana7 (92613)
India
December 13, 2021 8:28am CST
In the past, we did not have technology at our disposal. Now we do. So we need to revise tax systems such that people get oriented towards jobs or studies that will keep them employed. I will cite an example. The country needs doctors, armed force persons, law enforcers, educators, researchers, farmers. It cannot do without them. Now look at fashion designers, movie actors, movie directors, sports persons. Who is earning more? Are we spending more on things that are not necessary, ignoring what we need? Does it not make the job lucrative for the next generation? If more children turn to such professions, will the country seek immigrants for necessary jobs? Why must the two be taxed on same slab system? If we differentiate we might be able to reduce taxes elsewhere, ensuring more lasting employment for people. I am for doubling taxes for professions that are not as essential for survival.
8 people like this
6 responses
@florelway (21676)
• Cagayan De Oro, Philippines
13 Dec
Most tax systems are based on numbers where one is taxed more if he earns more. In our country businesses have to deal with paying a national tax that goes to the Internal Revenue and a local tax that goes to the local government. I am a tax collector for a local government and we don't tax professionals like doctors. Basic commodities and other essential commodities like agriculture products are taxed half of what we collect from other businesses.
2 people like this
@vandana7 (92613)
• India
14 Dec
I think everybody should pay for what they are receiving. So taxing even doctors is called for. But how much makes a difference. Agricultural produce taxation can be brought down by taxing entertainers some more. Likewise, not all administrators require to be paid at uniform slab. We have group of government personnel categorized as groups and their scales are predefined. But periodically, successive governments tend to increase their salaries as they can influence votes and voters. Effectively, they are taking salaries from the government and they also take bribes. We need to eliminate the places where they can park those bribes. For example cars. A car of say 500000 INR should not attract taxes other than what exist now. Anything more than that if the person spends ..slap taxes at a progressively increasing RATES, not amounts. Therefore, we would have remained democratic, but forced people to first save for their houses, their kids education, and their retirement savings. We have a businessman who has about 30 odd vintage cars. I bet he took loans for his business. Some of it got routed to his pocket legitimately as pay or dividends, which he used to buy those vintage cars. I feel spending on vintage cars or art work, does not benefit the country. In fact, it harms the country because it creates demand for monies increasing interest rate in the process. Therefore, students find education loans expensive and turn to other professions that are not really positive for the country like becoming sportsperson or singer or actor. Likewise, loans become expensive for manufacturers of goods, preventing them from achieving economies of scale by expanding. This leads to imports becoming cheaper, and local industries losing their market share regularly till they close down or are bought by foreign enterprise. How then are we really helping our country if we do not tax such a vintage car purchaser more? I am for slapping rather heavy taxes..500 percent or more on purchase of products such as vintage cars, art work, etc. That way, the person would either refrain, buy fewer, or work harder to achieve his desire. Same for spending a lot on homes. He built Antilla, which is office, residence, entertainment center, etc. All in one for a very large set of family. Recent security concerns have made him purchase another house in the UK. This house will obviously not have buyers. So it will remain a white elephant. If he has taken a home loan, or mortgaged it for loans, banks have had it, because they cannot sell it. Very few can afford it, and those who have such deep pockets know their advantage. Therefore, they would try to buy it at deep discount, forcing banks to absorb losses. We have had such cases before. So I am for taxing houses based on sizes and costs at progressive rates to prevent the monies of the country getting blocked in such investments that cannot bail it out in the hour of need. In fact, beyond a particular size and cost, banks should not be allowed to provide finance to such a person or his business. There has to be logic even to democracy.
@wolfgirl569 (64936)
• Marion, Ohio
13 Dec
That is a good idea. They make more so can afford more
2 people like this
@vandana7 (92613)
• India
14 Dec
There are many movies we wouldn't watch the second time. They lie in can after initial collection. The collection goes into the pockets of actors directors producers etc. Government hardly gets anything. If the benefit is not long term like education or housing, why shouldn't it be taxed more?
1 person likes this
• India
17 Dec
Even now, people like actors and sports persos have to pay more tax, I guess. Moreover taxes are also levied on goods. Luxury good are levied heavy taxes. When a rich man like actors buy some luxury item they have to pay more tax.
1 person likes this
• India
22 Dec
@vandana7 Price of Alto = 100 notes Price of Kia = 200 notes I have 300 notes. I go to buy a car. Earlier: I adjust my budget to spend 236 notes on a new car. Can still have my meal in remaining 64. Now: I have to spend all 300 notes for my preferred car, may even need to borrow extra 40. Obviously I cannot. So I buy another one with 118 notes. Or don't buy at all. Sounds like a nanny State to me - controlling my choices. For greater good? Yes, that is the catchphrase!
1 person likes this
@vandana7 (92613)
• India
25 Dec
@hora_fugit I was thinking in terms of indirect taxation. So kinda...if you want a flat of 1500 sft. you pay 10000 as plan approval charges. If you want to build a flat of 3000 sft. the plan approval charges should not remain 100000. Nor should they be 30000. Instead they should be 300000 at least. For every 500 sft after that, slab should increase by 100000 till 5000 when again there should be massive jump. The reason is, such properties become difficult for banks to sell, because few earn enough for them. However, the person plans to build it our of ostentatious desire, taking home loan for it. When loan is taken ..the demand and supply theory comes into play. Think of a small entrepreneur paying interest at 16 percent per annum for his business, and think of a person spending on luxury like Mallya did. One is good for the nation, other is not. So what is not good for the nation needs to be expensive. If it is expensive then only demand will come down, and bankers will be forced to offer loans to small entrepreneurs for 12 percent per annum. Likewise, if a person buys Maruti alto, GST may be 18 percent. But if he is buying KIA or Audi ...you bet the GST should not be less than 75 percent. There is no restriction. No control. Just taking care of nation's interests first because we are not a rich nation as yet.
1 person likes this
@vandana7 (92613)
• India
17 Dec
Nice to see you back Terrible Man. No...it is not like that. The basic exemption for them and us should be the same. Beyond that, incomes should be taxed at higher rates. Slab rates system that finance act has ... it should change. Pay more taxes is not same as paying more ratio of taxes. I earn 1000000 - I am an armed force person. I would pay about 1.25 lakhs. I earn 1000000 - I am an actor. I should pay 2.5 lakhs. That is what I am suggesting. As to goods, again... there is a logical and illogical part. If you buy a car like Maruti Alto, you may pay 18 percent tax. But if you buy an MG or Kia...you should be paying 50 or 70 percent tax because you can afford it.
1 person likes this
@garymarsh6 (23138)
• United Kingdom
20 Dec
It depends on how much you earn some pay little or no tax but those who are very wealthy find ways of avoiding paying tax. This should be illegal & fairer that they pay their fair share.
1 person likes this
@vandana7 (92613)
• India
20 Dec
Some of the provisions in tax laws enable very wealthy to avoid taxes. For example, here, we have rental incomes. On that we are allowed 30 percent for repairs and rent collections. But rental income is passive income! The person earning it is not contributing to domestic production. Therefore, that should be taxed slightly higher. Instead, we allow that 30 percent. LOL Then States... they ought to make rental agreement recording mandatory. For that, both the landlord and tenant need to pay nominal fees. This will expose the non-taxed incomes. Without such agreement record in the government record, along with up to date property tax payment evidence, there should be no legal rights for the landlord in the courts. You bet, 99 percent of people will rush to pay those nominal fees, and even Income tax. Right now, they pay nominal bribes to the inspector, if the inspector arrives.
1 person likes this
@just4him (267720)
• Green Bay, Wisconsin
25 Dec
It's an unfair system, that's for sure.
1 person likes this
@vandana7 (92613)
• India
25 Dec
We can now change that...and we are not changing. That is what is annoying.
1 person likes this
@just4him (267720)
• Green Bay, Wisconsin
25 Dec
@vandana7 I'm sorry it's annoying. I'm glad it's changing. I hope for the better.
1 person likes this
@LindaOHio (108954)
• United States
14 Dec
A lot of people in the US are for additional taxes for the top earners in the country.
1 person likes this
@vandana7 (92613)
• India
15 Dec
Direct taxes will lead to evasion. Indirect taxes are called for. Like this size house, you pay only this much tax, for every 10000 more, you pay 3000 tax... which will be collected by the concerned department. You buy this size car with this capabilities, you pay this much tax, for higher models, for every 3000 more, you pay 900 tax. Effectively, we truly tax luxury. Likewise, slap taxes on clothing, yachts, etc. At times, make it annual ..so that person thinks twice before buying.
1 person likes this