Yesteday, I was present in a talk delivered by Prof. Reddy of Hyderabad University on TAX EVASION, TAX AVOIDANCE and REVENUE LOSS. The talk was organised by Omeo Kumar Das Institute. The sum and substance of the talk, well supported by facts, probably compiled by Global Financial Integrity, was that the shadow or the black economy has grown in India to 50% now from a pre-liberalisation 37%. It has grown through transfer pricing, arm's length deals, tax incentives, Export zones, dealings in Power generation equipments and armaments, especially nuclear, where it is difficult for a buyer to know the wares' price, as there are no competing substitutes etc. etc. On the otherhand, though effective rate of taxes is 34%, through high depreciation allowances and tax sops (income based and investment based), the corporates end up paying only about 16% or so. Whereas it is desired that in a developing country the expense on education and primary health care ought to be about 11 to 15%, in India it is about 4.5%, and that too does not percolate down due to corruption. And his summation was that all these things are attributable to the politics in place though the legal framework to resist these are already there and cost of tax compliance and collection are quite low in India. Now a friend from the United States was kind enough to share with me the following link, showing that even that country may not be free from these ailments, despite having better regulations and implementations (like jailing tax offenders) in place.
Interested may follow the following link: Try a new link: http://www.huffingtonpost.com/michael-moore/america-is-not-broke_b_832006.html Uttam Kumar Borthakur _______________________________________________ assam mailing list [email protected] http://assamnet.org/mailman/listinfo/assam_assamnet.org
