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Difficult time for honest taxpayers
January, 14th 2008

Central government employees hope that the implementation of the Pay Commission recommendations would solve some of their woes. But they are sadly mistaken since this would entail a higher tax burden. The only solution is to save somehow.

THIS IS the most difficult time for hundreds of thousands of honest taxpayers. Shahrukh Khan, despite paying a whopping Rs 27 crores to the income tax department can afford to smile. But for many ordinary mortals it is nothing short of rubbing salt into their wounds. A government servant drawing a meagre salary, in a metro like Mumbai, would be struggling for mere survival.
 
There are a vast majority of people who are not able to invest owing to the meagre salary they get and as a consequence, pay the equivalent of a months salary by way of tax. A teacher employed with a public school had to pay around Rs 20,000, which forced her to take a loan in order to pay her monthly bills. This situation forces many to adopt corrupt practices because those who accept bribe are financially well off and never ever bother about the superfluous income tax.
 
Central government employees are hopeful that the implementation of the Pay Commissions recommendations would solve some of their woes. But they are sadly mistaken since this would entail a greater tax burden. The only solution is to save somehow but it is easier said than done.
 
A Delhi University lecturer, drawing a salary of around Rs 30,000 can hardly save as he has to pay Rs 6000 per month towards the fee of his children, Rs 7000 as rent, Rs 3000 as commuting expenses; a sum of Rs 10000 is needed to meet household expenses. He actually gets only Rs 25,000 per month as take-home salary and so he is barely able to make both ends meet. How can he save in such a scenario? He cannot compromise on his childrens education; he is lucky to have got an apartment for that kind of rent; he avoids personal transport and still has to spend more than what he can afford. As for household expenses he spends the barest minimum. His salary would be heavily deducted now, so how will he manage?
 
In spite of suffering financially these classes of people never complain. But on the other hand, there are millions of people in Delhi who somehow avoid paying tax. Traders in particular, very vocal when caught violating the rules and brought to book, are the worst offenders. Very few of them voluntarily declare their real income. Any bungalow in any part of the city like Delhi is worth more than a crore of rupees. There are at least 500,000 such structures. But there are fewer than 100,000 honest citizens who declare an income of Rs 10,00,000 plus per year. This is just ridiculous!
 
Government must constitute a separate body to identify those who evade taxes. A warning should be given to cough up the tax from a retrospective date. This will bring so much revenue that all the financial needs for infrastructure can be met from this source alone.
 
All the transactions in a wholesale market like Sadar Bazaar, Delhi, are carried out in such a way that neither party has any tax obligation. But in spite of being in the heart of Delhi, the pathetic condition obtaining in the market there can beat a semi-urban town hands down. This is the embodiment of real India and a true reflection of its anarchic governance. How can the government force these people to be honest when it itself absolves Mayawati of all corruption charges? A certain Lalu Prasad Yadav is admired and even invited to judge Lead India, an initiative of The Times of India. This shows that even the press is not concerned about the larger issues and tries to kowtow to the corrupt leaders.

Is there any hope at the end of the tunnel? Absolutely not because those who can be squeezed will be squeezed further and all the corrupt, immoral and unethical souls would wander free, preaching about nation-building, honesty and integrity!

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