GST - NOT A GOOD & SIMPLE TAX
And regarding Income Tax Dept, the amount collected by Govt. from Individuals & Companies do not add up to the cost of maintaining the Dept. Their sole purpose is to finger salaried class & people who oppose the vested interests in positions of power. The tax evaders grease off the palms of decision makers regularly and keep the chain of black money going.
The Government has produced after about 17 years of deliberation a GST system which is an absolute nuisance and nobody will know what is happening. It has replaced an already existing cumbersome system with another one equally complicated and it is not a "GOOD & SIMPLE TAX" as being highlighted. The Government in its enthusiasm of doing some spectacular photo-finish reforms has totally forgotten the simple logic that if any system is simple it will work & the chances of failure will be more if it is complicated. Like any other thing, Indian psyche is to copy & not to innovate. I present below a simple system which will be a real path-breaking reform and will benefit everybody except the vested interests i.e the political class & bureaucracy who wants to have a complicated system so that nobody can understand what is happening and keep everybody confused, so that they can milk the masses all the way to the bank. Recent glorious sample is DEMONETIZATION. Even after 6 months of the hyped event nobody knows what the outcome of the whole exercise is except that BJP has swept the important state assembly elections.
Now, my suggestions are briefly given below. Full idea is available on request.
1. The Government will fully come out from all commercial activities including Railways, Healthcare & Education. All present public sector / Govt establishments are to be privatized with Government holding 49% of ownership.
2. Income Tax for Individuals & also companies to be totally abolished. So it will reduce conspicuous consumption & all savings will go to Bank and used for development.
3. Only source of tax to the Government will be a Transaction Tax which will be levied only for Goods & services sold to the final individual consumers. In any consumable goods & services category, there will be only two slabs one lower one for mass consumption & other one Luxury which will be much higher.
4. Goods will be only in 3 categories: ready consumable, ready consumable / intermediary and Intermediary. No tax for Intermediary use, Transaction tax only for ready consumables
used by Individuals.
5. No Transaction tax for Capital goods used for production/business. Example: Commercial vehicles used for Goods/public transportation.
6. Movement of goods & services will be seamless throughout India as there will be no tax barriers and no question of producing or consuming states. All expenses of the Central, State & Local bodies will be distributed from the collection of Transaction tax from the whole country. There will be substantial reduction of no. of employees in the Govt. & will result in huge saving in public expenditure.
7. All commercial enterprises have to enter in a Govt. maintained centralised system day-to-day activities of the business and the data thus collected will be used for planning by Govt. & private sector for efficiency.
8. The concept starts from the fact that ultimately all activities carried out by Individuals are transformed into Goods & Services to be consumed by the Individuals only.
So, is it simple enough or not? Whole detailed concept is available on request. more