N.R. Narayana Murthy, Founder and Chairman Emeritus of Infosys, said here on Saturday that reducing friction for business and creating an easy-to-comply-with tax system can help shore up the Human Development Index (HDI) of the country. He also called for jailing people who do not pay tax as it is used to create infrastructure and facilities for the poor.

In an interaction with students of the National Institute of Engineering (NIE), Mr. Narayana Murthy said that making it easier to do business and reducing friction will facilitate faster growth of businesses and encourage both domestic and foreign investors to invest in entrepreneurs in India, leading to creation of more jobs and better income.

In this context he underlined the importance of creating a transparent and stable tax system which will go after tax collection in a very rigorous way and punish people who do not pay their tax. Citing a 1980s case of Leona Hemsley of the U.S. who was jailed for tax evasion, Mr. Murthy quipped “perhaps she ignored paying tax imagining she was a very big person like our friend Vijay Mallya.” If the tax laws are easy to comply with and the evaders are punished, there will be no problem of taxes, said Mr. Murthy in the context of reports that the amount of tax under contention in India was huge.

“Use part of the tax collected to build infrastructure to pave way for growth of businesses and invest in providing basic education, health, nutrition and shelter for the poor through an efficient, honest and transparent public governance system.”

Allaying fears on automation resulting in loss of jobs and creating social crisis, he said such an argument and logic was also used to oppose computerisation of banks in England and the arguments continued in India till 1989 that people would be thrown out of jobs. “Automation will not take away jobs but will create opportunity for human beings to get better and better quality of jobs provided there was constant training and people are prepared to work hard and learn new things,” he added.