Why i under report my Income: Open letter to PM Modi from an Indian

swatkats

swatkats

Skilled
Dear Prime Minister Narendra Modi sir,

Namaste,

My name is Prasad. I have a small industry in Balanagar Hyderabad. My industry turn over is about 2 lakhs per month. This means per year it is 24 lakhs. Honestly and truthfully with all the exemptions I should be paying about 3 lakhs Income Tax to Government. But I just pay 30,000. Why?

I was born in a middle class family and with hard work and studies I came up well. Initially I did some job for a living but after saving every paisa I have grown to the level of having my own start up industry. About 1 lakh is enough to take care of my family's needs and other 1 lakh I invest (either in gold or shares or buying lands).

In the one lakh I spend for family, about 30000 is going indirectly in some form or the other to the government. From groceries to TV to mobile I am paying 20 to 30% of spending in tax only. If I enjoy a small party of say 3000 on drinks about 60% is going as tax to government.

Even for a liter of petrol I am having pumped about 30 rupees is going to government as tax. When I bought the car in form of taxes alone I paid about one and half lakhs. For a plot I paid 1 lakh as registration fee. The colony I am residing does not even have a road of any standard and hence I paid 50,000 as development fee.

After seeing the plight of patients in government hospitals and knowing well the looting well the looting nature of private hospitals, I took a health insurance policy for my family members and shamelessly even on that I am charged a service tax.

Like robbers every where I am taxed. Even in graveyards government is taxing people. But is what is this government doing to us in return?

Do we have confidence that our children will learn anything if joined in a government school? Are we assured to come home alive if we go to a government hospital? Other than country's defence and laying roads we are not understanding where the developments works are going. Buy a car, there is road tax, get on road there is toll tax. Are we not ripped off sir?

Where is the money we are paying in taxes sir? If I have to raise salary of the employees in my industry I appraise their work and give an increment. But what are the governments doing? Even if a government employee works or not they get the same salary and same increment. Why is it that our money is so cheap, sir? On top of it taking our tax money as salaries people don't do our work. If office is at 10 people come at 11 and wont move a pin without bribe. So, tell us sir, why should we pay taxes? If my industry has to get uninterrupted power I need to pay bribe. In all I pay around 10000 as bribe per month. How can I show this bribe in white, SIR??

Simply for this reason we hate to pay tax to governments sir. That does not mean I have no social responsibility, sir. I gave 10000 when you have appealed to help for the army fund. I give 20000 a year to an orphanage in my neighbourhood and gave a donation of 1 lakh in the name of my father when people of my village said they will uplift the school. But sorry, I don't have same heart to pay tax to government, Sir!

Anyways, this is past. Now we will see everything in white. Since you have taken the call, I will pay 30% tax in the 10 lakhs I have and change it to white. But can you guarantee me that I don't have to pay the 10000 bribe I need to every month? Or will you permit people to take bribes too in the form of cheques?

And I did not talk about leaders...from street leader to MLA for all the elections for all the parties I should give funds. If not I am doomed. Will you bring an act to such people to accept funds in the form of cheques? Will the party funds be revealed to public?

Already we are paying so many taxes and tell us how is the government serving us. We wont pay taxes for the luxurious life of politicians or for salaries of government employees sir. We will try to not pay as much possible.

In another 10 years the country will see again a huge rise of black money. Will there be demonetization even then? This is not why we have elected you sir. Win our trust, do justice for the taxes we are paying first, then people will repose faith in the governments. We are ready to support you, and waiting to see you act!

Your

Fan, and a voter



Source: http://www.korada.com/politics/why-i-evaded-tax-a-common-man-open-letter-to-narendra-modi/
 
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I, along with several lacs of Indians endorse your views. I guess ARTHKRANTI (http://www.arthakranti.org/) is on the cards. What I understand from news reports the PM and his financial team are actively considering arthkranti proposals. May take time (maybe 10 years or more, we all maybe dead and gone by then) but the future generation will have a fair and decent life ahead of them.
 
Guy earning 10 lacs is crying about taxes. What about those earning less than that? IMO there should be no tax till 12 lacs PA for both men and women. All houses cost are in crores now. Even if a person saved his entire 12 lac salary he won't be able to afford a house in 10 years time when he saves 1.2 crores because by then house prices would have gone up by three times they are now. Even fringe areas near cities are costing 30+ lacs now days for small 450 sqft houses.

Only way to earn more taxes is to allow more money into poor people hands. Those who have more will spend more. If a person has to save every little amount of money just to get by a month, he isn't going to spend on anything other than the most basic stuff necessary for his family's survival.
 
While I absolutely do not agree to tax evasion as the says he does, he still does have points. The tax slabs need to be revised asap else folks will continue to evade tax. There should be no tax upto 5 lacs income, 10% from 5-10, 20% from 10-20 and 30 beyond that. It's idiotic that the government continues to tax folks both directly and indirectly while industrialists keep building mountains of black money.
 
Yes, there should be NO Tax up to 5lakhs/annum.

Btw this dude got everything right and it is exactly the pain of middle class.
 
The most important point is that in a democracy, the govt is a service provider hired by the people and the income taxes are paid so that people can get things done for them. But the problem in India is that the taxes are used for everything, but for the services needed by the less than 1% population who pays this tax. So its not even a question of slabs or exemptions. The fundamental problem is how the taxes are utilized.

For example, some half baked welfare scheme with loop holes for exploitation is prioritized in the interest of building a vote bank or so that some politicians can scoop up the funds in between while basic things like maintenance of the roads for example is nowhere on the list of things to do. Hyderabad generates so much tax revenue, but look at the state of the roads. I am not saying that taxes should not be used for welfare schemes, but that they should first plan to use it for the purpose they are paid for and then go to other plans.
 
Lord Nemesis said:
For example, some half baked welfare scheme with loop holes for exploitation is prioritized in the interest of building a vote bank or so that some politicians can scoop up the funds in between while basic things like maintenance of the roads for example is nowhere on the list of things to do. Hyderabad generates so much tax revenue, but look at the state of the roads. I am not saying that taxes should not be used for welfare schemes, but that they should first plan to use it for the purpose they are paid for and then go to other plans.
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You should really not whine about Hyderabad roads. They are a million times better than the "roads" we have here in Bangalore. I was recently there in the Hitec City area to present a talk and let me tell you I'd die to have roads here that are half as good as those - especially that access restricted ORR. To rub further salt into those wounds, we pay way more road tax compared to AP.

I do agree with your primary point though - yes more investment is required in infrastructure - irrespective of whatever location we live in. We are 20-30 years or more behind in comparison to the west in terms of infrastructure.
 
I find one thing difficult to understand: why should a person be taxed twice: first when he earns and then again when he spends the same (tax paid) amount?
 
^^ Because, less than 1% of the population is paying that tax when they earn. However that Income tax collection is more than the indirect tax collections.
 
Whenever I read this kind of "open letter", I am reminded of a story:
Once upon a time in a village, everyone caught a strange disease. Whatever medicine they applied, it dint work. One day a sage passed through the village. He looked at the disease and prescribed a cure - everyone needs to take a bath in huge amount of milk on an amavasya (or new moon ie no moonlight). Everyone in the village came together and decided that they will pool their resources together for the milk and take bath at a common place.

When the amavasya arrived, everyone went to the designated place and poured in their share. Once done they started to take bath.
On the very next day...............

It was found no one was cured.

The reason was - Almost everyone came up with a brilliant idea - It is amavasya and no one would notice if they poured in water instead of milk.

Some had pressing need for their share of milk, while others who dint exactly have a pressing need but felt they might in the future, some who felt wronged about paying out their share and lastly, other's who dint care.

There are two things wrong in India - one, we think two wrongs make a right. If someone is stealing it is okay to steal. Two, we want instant solutions to problem to generation issues in one go like a magic wand.
 
raj404 said:
I guess ARTHKRANTI (http://www.arthakranti.org/) is on the cards. What I understand from news reports the PM and his financial team are actively considering arthkranti proposals.
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These Arthakranti jokers are riding a wave of free publicity, claiming they gave the idea of scrapping notes to Modi, even implying they're Modi's right hand man, just so they can drum up interest in their proposal.
They themselves are confused about when they met Modi, but indications are it was when he was Gujarat's CM, not while he was PM. And they wanted all notes above Rs. 50 to be permanently discontinued, whereas the BJP has added a 2000 rupee note.
AFAIK nobody from BJP has even mentioned this group. Unfortunately the media are not verifying their stories and because Arthakranti threw in some masala about Modi taking time out of his busy schedule to meet them while Rahul Gandhi ignored them, BJP have not come forward to deny their claims either. Unsurprisingly they now claim their implementation was not followed properly : http://mumbaimirror.indiatimes.com/...slams-implementation/articleshow/55551131.cms

Someone had already picked apart their policy 2 years back : http://www.sabhlokcity.com/2014/01/...arthakrantibjp-bank-transaction-tax-proposal/
The biggest flaw with their proposal IMO is saying the govt should limit cash transactions to Rs. 2000. When the govt cannot even get people to follow simple traffic lights, expecting them to supervise your wallet is nonsense. On top of that, taxing bank transactions will encourage people to transact outside the banking system which is exactly what the black money economy is.
 
abhi1984 said:
The reason was - Almost everyone came up with a brilliant idea - It is amavasya and no one would notice if they poured in water instead of milk.

Some had pressing need for their share of milk, while others who dint exactly have a pressing need but felt they might in the future, some who felt wronged about paying out their share and lastly, other's who dint care.
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Lets look at an alternative version. Lets say that this sage advice's that every body needs to bath in milk on 50 amavasya nights and that everybody needs to contribute a jug of milk each time so that they can all take a bath and get cured. Lets say that the first time, most of the people contributed milk, but the sage and a few of the villagers siphons it off and sell off a big volume of it in another village and the rest, the sage gives away to a select few people of his liking. The villagers saw that they were not cured and after seeing that they are not getting any benefit after contributing for a few times, some of them start contributing only half or quarter of a jug or stop contributing all together. The point being that when people see that their contribution is not getting used for the purpose they were contributed for, they will not even have a reason left for contributing.
 
Crazy_Eddy said:
Someone had already picked apart their policy 2 years back : http://www.sabhlokcity.com/2014/01/...arthakrantibjp-bank-transaction-tax-proposal/
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The bank transaction tax sounds ridiculous. What constitutes a taxable bank transaction? would any movement of money from one bank account to another be taxed? Does that mean that if for some reason, I transfer 1 Lac from my HDFC to ICICI account and back later, I will lose 4000 Rupees (2%) in the process for no good reason?
 
Chaos said:
While I absolutely do not agree to tax evasion as the says he does, he still does have points. The tax slabs need to be revised asap else folks will continue to evade tax. There should be no tax upto 5 lacs income, 10% from 5-10, 20% from 10-20 and 30 beyond that. It's idiotic that the government continues to tax folks both directly and indirectly while industrialists keep building mountains of black money.
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These are the slabs proposed by the Direct Tax Commission set-up to review the tax structure. Neither the previous govt. nor, this one implemented it.[DOUBLEPOST=1479829841][/DOUBLEPOST]
Crazy_Eddy said:
Someone had already picked apart their policy 2 years back
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The policy of a BTT replacing IT is quite old. This was studied by many and conclusion was that it is not worth pursuing.

Just step back for a sec: India with issues like connectivity/bandwidth, illiteracy, language, general awareness thinking of BTT when country like Sweden with the most cash-less society didn't?
 
That Anil guy and his bunch of morons sound just like what AAP and his retards sounded some years back. And see now how much power they are wielding, now. Such dumb suggestions of theirs and trying to win the limelight for someone else, and their work. That article made them sound like: The Rolling Stones behaving like the Pope. People staring in awe, and trying to get a glimpse.
 
Hahahaa.
No really it is a laughing matter.

Please understand that Democracy works on pandering to the demands of majority. It is their priorities that take precedence over your priorities.
Whatever we are getting today is a result of democratic process.

Our public chooses the leaders based on what they want. The leaders give to public what they are evaluated on.
Simple.
 
People who are ********** about high taxes in India should seriously research about how much god damn taxes you pay in US. Its insane. Countries like US are rich because people pay taxes promptly, it doesnt matter what you are getting back in return. If you are unhappy with your MLA/Govt, dont vote for them in the next elections.

Yes, I agree that we have high corruption levels. But its absolutely not a reason to not be law abiding citizen of this country.

*************** and pay taxes, Prasad. Atleast, stop encouraging others to evade taxes.[DOUBLEPOST=1479910385][/DOUBLEPOST]
nimod said:
I find one thing difficult to understand: why should a person be taxed twice: first when he earns and then again when he spends the same (tax paid) amount?
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This isn't unique to India. Pretty much same in almost every other country in the World. Running a country is not cheap you see! Think about how much money India invests in Military alone..


****[MOD DELETE]
 
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PhotostarSR said:
it doesnt matter what you are getting back in return. If you are unhappy with your MLA/Govt, dont vote for them in the next elections.
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This indifferent attitude is wrong. Just not voting for the officials in the next elections is not a good enough detriment. There should be serious punishments to hold them accountable so that people take this job seriously.
Maybe it doesn't matter to you what you get back in return, but it does matter a lot to me and many others as that's the whole point of a tax system in a civilized and democratic society.
 
PhotostarSR said:
People who are ************ about high taxes in India should seriously research about how much god damn taxes you pay in US. Its insane. Countries like US are rich because people pay taxes promptly, it doesnt matter what you are getting back in return. If you are unhappy with your MLA/Govt, dont vote for them in the next elections.
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Lets say that you hire a cook to prepare food for you and you pay him this wages and cost of ingredients. The cook decides not to provide you any food and will just use the money for himself or his friends and maybe even put some of that money for charity. He says that he would throw some food your way if he is ever in the mood. He also says that, you have to pay him every month from that day on or he would trash you. Even if you try to replace the cook, the new one is also going to do the same thing. This is pretty much what our tax system is like.

In a democracy, the govt is an elected body chosen by the people to do various things for them and the people pay taxes so that the elected body can fulfill those duties. The first and foremost obligation of the govt is towards the tax payers and to ensure that they get what they are paying for. Laws are created for the sake of the citizens and tax evaders are to be punished under the law because they are trying to enjoy things without contributing for it. The govt does not have some sort of automatic god given right to collect taxes or punish people who don't pay taxes. The taxes are for the sake of tax payers and the punishment for tax evaders is also for the sake of tax payers. Tax payers have a right to question how their taxes are utilized.

The problem is that the rate of taxation, but inefficient or outright wrong usage of taxes. So, the point is simple. Pay taxes as you should, but don't *******when you do not see it being utilized properly.

********MOD DELETE
 
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