[ramzsys]

Originally Posted by Balthazar

The oil industry collapsed and what did the government do?

Originally Posted by drmohitg

Attachment 2022702

During the short period when crude/futures was trading low/negative, we already had our reserves full.

It would be easy for an armchair expert to say it is an opportunity lost; but back then nobody was sure which way economy/markets/covid would go.

https://www.reuters.com/article/us-h...-idUSKBN21E2W5

Of course, China bought more than their usual despite the low economic activity since they had/have a higher reserve capacity.

--

Since we don't have a ganges of crude running down the geographic limits of the country, the commodity is imported and therefore it arrives as a liability; The hope is that the countrymen burn it to generate enough economic multiplication to offset it in the balance of trade; whether it happens or not, at least a higher pump price will keep a check on the thirst for crude.

Something like the green tax on 15+ year old vehicles.

[fiestarry]

I have no problem with the rise in fuel prices. The GoI is obviously doing this for a good reason.
Given that only 1.96 pc of Indians pay Income tax, Increasing fuel prices is a good method to tax everyone.
The scheming trader, doctor, farmer etc are all bound to pay for fuel and that way the Central and State Govts will earn good revenue.
Reg the poor tax base for Income tax, a friend of mine who is a senior IT officer says that this is because IT evasion is still a civil offense. People don't file tax returns or show very little taxes, give vague replies to IT and the matter drags on for long; most officers are transferred and unless they are big fish, the Dept doesn't follow through.
Only some cases get into the serious view and get the nod for shift as a criminal case.
The US system of serious criminal charges for even the mildest evasion is the best option but needs changes in legislation.
And the same cribmasters will vent their spleen that the were jailed for ' oversight'.

[m8002?]

Originally Posted by fiestarry

I have no problem with the rise in fuel prices. The GoI is obviously doing this for a good reason.
Given that only 1.96 pc of Indians pay Income tax, Increasing fuel prices is a good method to tax everyone.
The scheming trader, doctor, farmer etc are all bound to pay for fuel and that way the Central and State Govts will earn good revenue.
Reg the poor tax base for Income tax, a friend of mine who is a senior IT officer says that this is because IT evasion is still a civil offense. People don't file tax returns or show very little taxes, give vague replies to IT and the matter drags on for long; most officers are transferred and unless they are big fish, the Dept doesn't follow through.
Only some cases get into the serious view and get the nod for shift as a criminal case.
The US system of serious criminal charges for even the mildest evasion is the best option but needs changes in legislation.
And the same cribmasters will vent their spleen that the were jailed for ' oversight'.

You mean its perfectly fine to squeeze the general population because some of the fat rats dont pay the dues and the IT/govt. cannot bring them to book?

Do you understand that consumption based tax is a curse on the poor? The poor pay a disproportionate part of the income on funding this tax than the rich - be it fuel, food or any other items. An Alto owner and a BMW owner driving 50 kms each day paying almost the same amount of fuel tax is just not right.

[avira_tk]

Originally Posted by fiestarry

I have no problem with the rise in fuel prices. The GoI is obviously doing this for a good reason.
Given that only 1.96 pc of Indians pay Income tax, Increasing fuel prices is a good method to tax everyone.
The scheming trader, doctor, farmer etc are all bound to pay for fuel and that way the Central and State Govts will earn good revenue.
Reg the poor tax base for Income tax, a friend of mine who is a senior IT officer says that this is because IT evasion is still a civil offense. People don't file tax returns or show very little taxes, give vague replies to IT and the matter drags on for long; most officers are transferred and unless they are big fish, the Dept doesn't follow through.
Only some cases get into the serious view and get the nod for shift as a criminal case.
The US system of serious criminal charges for even the mildest evasion is the best option but needs changes in legislation.
And the same cribmasters will vent their spleen that the were jailed for ' oversight'.

What percentage of the population do you think will pay taxes if everyone was honest to declare full income and get absolutely nothing in return? The tax collection of in line with data, the threshold is 2.5 lakhs, outside the urban areas, such income is unthinkable unless you are employed by the state to pass the time, otherwise you have to own an enterprise.

The trader, doctor and farmer provide a service, that the state shouldn't be involved in. Do you know the expenses involved in running a business outside the service industry and the cost of financing daily operations? Salaries and interest are practically all that the government uses its money for. The enabling expenses in unaccounted money is paid to a certain class of people who produce nothing and earn fat salaries and guaranteed pensions.

The US system was invented to enslave the population and that's the purpose of it here also.

Your IT officer friend is free to target anyone. There is absolutely no appeal or redress if a taxpayer receives a notice, technically there is, if you have 3 decades of life to spare. You have to pay with interest and you face jail time, people can't simply refuse to pay. The officers will be transferred, that's the condition of work of working for an all India service, they don't take their cases with them. They can go after big fish and nothing will happen to them, can you name anyone who has the resources to take on the IT department?

[Balthazar]

Originally Posted by ramzsys

It would be easy for an armchair expert to say it is an opportunity lost; but back then nobody was sure which way economy/markets/covid would go.

Quite a lot of people were sure of what was to come.

The signs were apparent for some time, take the Russia-Saudi disagreement at OPEC+ for instance.
It was a long drawn out process and the writing was on the wall.
For instance, this article was posted a month before the crash
https://energy.economictimes.indiati...s-cii/74759111

So no, when you say no one knew what was coming, you are quite wrong there. And because our Babus saw the writing on the wall, they decided to shore up our reserves and save Billions in the process.

And as far as our reserves being full is concerned, we were not only storing oil for us, we were to store oil for the gulf as well (that didn't really pan out though). And not only are we storing oil in our ground reserves, several massive tankers are anchored off the ports, holding additional fuel. And we have contracted several reserves in the US to store even more oil.

They had started capitalizing on the slump by the end of March
https://economictimes.indiatimes.com...2.cms?from=mdr

Yes, you are correct when you say that our reserves are full. They were filled and the Govt. saved Billions when they took timely action and decided to take advantage of a good situation. No issues there. Quite good on their part.

I have a problem with them reaping double benefits, they buy cheap fuel with our taxes, and impose more taxes to sell them to us. Why not pass on the benefits to the consumer?

Originally Posted by ramzsys

The hope is that the countrymen burn it to generate enough economic multiplication to offset it in the balance of trade; whether it happens or not, at least a higher pump price will keep a check on the thirst for crude.

Well, if they hope we "use it to generate economic multiplication" wouldn't it be better, then, if it was cheaper to help stimulate the economy. And if they want us to use the fuel to stimulate the economy, why would they need to "keep a check on the thirst for crude." Wouldn't staying "thirsty" restore economic activity faster?

Surely, if I am already cash strapped because of being out of work for 4 months in a global pandemic, I don't need to be burdened with expensive fuel? We know increasing demand is a good way to ensure a V shaped recovery, but how do you increase demand if people don't have disposable income?
I am not talking about IT professionals who can work from home, or govt. employees who have continued to receive their salaries, I am talking about the waiters, and the cooks, and construction workers, and the daily wage laborer, the thela-wala, the maids and the small shopkeepers. Wouldn't they consume more if they could benefit from the global oil crash? And wouldn't that help the economy?

Could be a good debate.
Govt. taxing people to shore up their finances and then implementing a better stimulus vs. letting people consume more and increasing demand that way.

[wheelguy]

Common man not impacted by rising petrol, diesel price, says Dharmendra Pradhan. - Link

“When a problem comes in a family, the person carefully manages the finances to meet future challenges. The hike in fuel price should be seen like this,” Pradhan said.

“Under the Pradhan Mantri Garib Kalyan Scheme, we have provided Rs. 1,70,000 crore under several schemes for poor and farmers,” said the union minister.

Defending the price rise, Pradhan said the national as well as global economy was going through a challenging time and that it had impacted the demand and supply of fuel across the world.

He said that, due to the coronavirus-enforced lockdown, there was a 70 percent reduction in demand for petrol and diesel in April and May. However, with resumed economic activity, the demand is coming back towards normal, Pradhan was quoted as saying.

In such a scenario, the recent increase in petrol and diesel prices has not impacted the common man, said the report quoting Pradhan.

He further said that the tax revenue earned from petrol and diesel is being used to fund health, employment and economic security of the people of the country, said the report.

Pradhan also slammed the Congress and its chief Sonia Gandhi for launching a nationwide agitation against the government for raising prices of petrol and diesel.

“Sonia Gandhi and Congress cannot digest the welfare of poor people,” he added.

[drmohitg]

Originally Posted by wheelguy

[b]Common man not impacted by rising petrol, diesel price, says Dharmendra Pradhan. -

No surprises. The current government has a history of almost all ministers making such foolish remarks. Someone needs to give him a basic course in economics before handing him over the Oil ministry. If anything this further cements the importance of Education!

[fiestarry]

The government should not increase fuel prices, income taxes, GST or any form of revenue.
But it should continue to feed our teeming millions free, pay their transport bills, their Covid medical bills, give ex gratia payments to everyone who dies, fight wars and decimate the bordering countries at the slightest provocation but not ban their apps or singers; all without collecting a single penny from the public. I like this idea of a welfare state. Just need a BPL card and enjoy the State largesse.

[rjainv]

Originally Posted by fiestarry

The government should not increase fuel prices, income taxes, GST or any form of revenue.
But it should continue to feed our teeming millions free, pay their transport bills, their Covid medical bills, give ex gratia payments to everyone who dies, fight wars and decimate the bordering countries at the slightest provocation but not ban their apps or singers; all without collecting a single penny from the public. I like this idea of a welfare state. Just need a BPL card and enjoy the State largesse.

I am pretty sure, no one will bat an eye lid on increased taxes, if we could see a direct connection or impact of tax collected with all social activities government needs to do.

However with lack of transparency on govt expenses, and wasting of public money on statues and vista projects, I believe govt needs to first bring it's own house in order first before asking all tax paying citizens to cut theirs and pay even higher taxes.


Reality is that for every Rs 100 collected as tax, there is probably Rs 1000 of tax evaded.
And of that Rs 100, probably Rs 95 goes in improving the lifestyle of politicians and furthering their agenda before the remaining gets used in a fruitful way. Ofcourse all numbers are made up - suit yourself with what number you think are closer to reality.

[Sandeep500]

Originally Posted by fiestarry

The government should not increase fuel prices, income taxes, GST or any form of revenue.
But it should continue to feed our teeming millions free, pay their transport bills, their Covid medical bills, give ex gratia payments to everyone who dies, fight wars and decimate the bordering countries at the slightest provocation but not ban their apps or singers; all without collecting a single penny from the public. I like this idea of a welfare state. Just need a BPL card and enjoy the State largesse.

Sir, no government does these things or provide such sort of freebies for their undying love towards such people. They do so because they comprise a major chunk of votebank due to their large numbers.

Why are middle class or salaried class not provided any relief..because they are too small a number to cause some bother to govt. by means of violent protests or agitations.So they can be milked by means of heavy taxes without any hiccup. And most important among these are several people who don't see any reason and blindly follow there set mindsets without caring for right or wrong.

[msdivy]

Originally Posted by fiestarry

all without collecting a single penny from the public.

Hope you are joking. Every paise Govt gets is from its citizens' pocket, either as direct or indirect taxes.

Originally Posted by fiestarry

The government should not increase fuel prices, income taxes, GST or any form of revenue.

Govt can increase the tax. But is there an upper limit, if so what is it?

[longhorn]

The corporate taxes have been cut from 30% to 15% between 2014 and today. During the same period, excise on petrol has gone up by around 250% and than on diesel by around 790%. Just goes on to show where the priorities of this govt lie.

[ramzsys]

Originally Posted by Sandeep500

Why are middle class or salaried class not provided any relief..because they are too small a number to cause some bother to govt.

A microscopic minority of rich. A handful of middle class (upper, mid). Then comes the majority: lower middle class, working class, official poor.

When 'India Shining' campaign did well to earn urban voters, the majority Bharat voted them out. Hence the current way of doing politics - extract as much as possible and distribute it across the countryside.

What UBI? We already have one working in this country for the rural and it's named NREG. They await the next freebie scheme and the PM announced free grain till November yesterday.

Democracy works fine in paper but in reality is the idea through which a vote decided by sound logical decision is easily nullified by the vote of a freebie loader who doesn't pay anything except the paltry indirect taxes.

Originally Posted by longhorn

The corporate taxes have been cut from 30% to 15% between 2014 and today. During the same period, excise on petrol has gone up by around 250% and than on diesel by around 790%. Just goes on to show where the priorities of this govt lie.

With tax cuts to tempt the foreign overlords with better profits to attract FDI as investment or capital to draw out those aforementioned majority of working class stuck in disguised unemployment - thus increasing the tax base by converting the unorganized sector to organized and thus better data of the economy. This also raises the HDI levels which leads to all round prosperity and consumption led growth and reduction of TFR - stable population which allows us better quality of natural resources.

All this has to be done before the country starts to age - there's only 2 more decades left; if we do it right we get to have a life like in North America, else everything goes south.

[lurker]

Originally Posted by drmohitg

No surprises. The current government has a history of almost all ministers making such foolish remarks. Someone needs to give him a basic course in economics before handing him over the Oil ministry. If anything this further cements the importance of Education!

he is not paying for it. That is what he meant, once they come to power all sound the same.

today the congress is opposing, tommorow if they come to power they too will raise fuel prices. India being a divided country as it is, there will be no mass uprisings such as in germany or france where entire groups of motorists abandoned their vehicles mid way in a busy highway as a mark of protest.

They also may be unaware as to how this is a last opportunity else things go south in two decades and grin and bear the rising prices.

The govt doesn't pay any cost for economic mismanagement. They skim the profits and use it as they see fit. They pass on loses dutifully to the end consumer. The entire idea of having enlightened democratic governance was to avoid such pedastrian mercantalism in governance, but that exercise has failed in India.

The british ruled India in pretty much same fashion. They imposed high taxes on Indians even when they were going through a famine.

[avishar]

Meanwhile...

India's Fuel Demand Continues To Recover In June: Report

Indian state-refiners' petrol and diesel sales rose in June compared with May, continuing with a gradual recovery as the nation relaxed lockdown aimed at stemming spread of COVID-19, provisional sales data showed on Wednesday.
State-retailers' gasoline sales in June rose by about 36 per cent from May to about 2.04 million tonnes.

Sales of gasoil, which accounts for about two-fifths of the country's overall fuel sales, rose by about 20 per cent in June compared with May to 5.54 million tonnes, provisional sales data showed.

However, petrol and diesel sales in June are still down by about 15 per cent and 17.1 per cent respectively from a year earlier.

So India is already at an 85% of normal consumption level. That means by the next month or two as gasoline sales reach pre-COVID levels (and even some growth) the government is going to make a pretty penny!