[Fuldagap]

Originally Posted by locusjag

Please desist from drawing false equivalences. Already we've had egregious instances like fascism being dragged in forcefully when logic failed.

I quoted both of these not to draw equivalence to increasing or decreasing of fuel prices rather to cite that ill conceived actions have end results that end in disasters that could have been avoided in the first place had the mass populace not turned a blind eye to whatever was being 'dictated'.

Originally Posted by locusjag

The Broken Window theory and the Sparrow experiment were concepts that needed to be proven through actions and by validating with the results.

With all due respect, Broken Window was/is a fallacy not a theory, which even certain people tried to oppose since the start and which eventually got proven as a fallacy. Sparrow was not an experiment, an experiment is one which is conducted to prove or disprove a hypothesis, mostly performed in research labs under supervison of experts. Calling Sparrow campaign an experiment would be like going soft on Mao's ill concived actions based on his rhetorics IMHO. Experiments should also not result in the mass hunger situation that a country as big as China was forced into and that too for years. Researchers are even trying to connect the current Covid pandemic as a by product of the decades old Sparrow campaign by Mao. Please read on the internet further, am desisting to further going off topic.

Originally Posted by locusjag

Here, it is a straightforward situation. Causation or even correlation is not under question. Percentage of taxes (including excise) have gone up because sales turnover is down. The product of this multiplication is necessary for Governments to function. If they don't function as expected, they'll be roasted by the same people who are complaining about the high taxes on petroleum. In fact poor people will be getting free rations etc. out of these very taxes that are levied on petroleum in these hard times.

Well sir, enough has already been said countering these very notions in the thread earlier in a very articulate manner, the same arguments apply here too. I'd be reinventing the wheel countering this.

Originally Posted by locusjag

So please add value to the discussion by suggesting solid ideas rather than by drawing such invalid equivalences. I'm not being dismissive of you - nor have I used pejoratives to put you down (whereas I've been called sympathetic to fascism for having a valid opinion).

Thanks, I'm very sure of this.

Originally Posted by locusjag

How can our Governments run without tax revenues really? What am I missing?

Nobody is saying governments could run without taxes. Transparency, accountability, actual results of actions by the govt and fair taxation practices are being questioned among many other things, the most important one being whether decisions by the govt are study based or not. To a point comfortable do the masses readily pay taxes, when it rises to a level unbearable by the common man, unintended consequences are what the society faces then, whose blame could be put on the govt or the tax payer alike. For eg. tax evasion, smuggling of goods etc.


Somebody quoted that his neighbourhood shopkeeper is escalating prices to cope up with enhanced expenses and offset low sales and he seems to be fine with the practice. This amounts to criminal offence as far as the govt is concerned. It's hard to counter such notions with logic as he wouldn't be able to grasp it in the first place.

Somebody else cited poor people driving Jaguars, well what to say to this. Is there a difference between a poor and a criminal or not?

Fuel prices not only affect Fortuner owners, they directly impact distribution costs which include potatoes, bread, milk etc. The trucks ply on diesel. In areas not urban, diesel is the primary fuel for transportation, be it shared taxis like Sumo, Trax etc., tractors for farming, generators. The portion of economy which is not on paper (informal sector) has to be addressed by policy makers while taking decisions. We don't live in an ideal world where unaccountable things don't happen. They affect the economy too, in a big way. The poor are to be helped not because of ethics or religious favours, taking care of the poor saves a lot of expendtiure to the country as it curtails spread of diseases, spread of crime among other factors and binds the society together to a development path which is peaceful in nature and sustainable. The point is, this fuel price hike, like those in the past has potential to hit the poor man and the middle class hard and prove detrimental to the already shattered economy.

Personally, I don't feel the pinch as much becasue I get chauffeured around for work, the fuel bill being taken care of by the govt while occasionally driving my own vehicle with my wallet money.

[itsmb]

Came across this meme on Twitter, could not stop myself from posting it here.

For those who don't understand Hindi.
Diesel
Economy

[ashlil]

I see many misplaced notions in this thread. The first being that fuel taxes were increased because of the pandemic. I cannot remember any pandemic in between 2014 - 2019 and fuel taxes continued to increase. The second being fuel taxes are somehow being used to reduce poverty. In between 2009 and 2011 poverty rate reduced by 3.8%. How did that happen without massive fuel tax?

Lastly, let us grant that the government is short of revenue. Is the fuel tax increase the best way? Why should the corporate tax be decreased to 25% if the government is short of revenue? I know I know. The corporates employ people. But, so does the middle class. For example a middle class family with a gross revenue (income before tax, loan payment and expenditure etc) of 15 Lakhs supports 5 people ( 4 family members and 1 domestic helper). People supported per lakh of gross income = 0.3333. Reliance industries has a gross revenue of 65925000 lakhs and employs 194056 people. People employed per lakh revenue = 0.0029. So, why does it make sense for middle class to pay more and not the corporate?

[longhorn]

Excise duty on petrol has gone up from Rs 9.26 in 2014 to Rs 32.98 today. That's a near four fold increase. What has changed on the ground for the common man to substantiate such an increase. I would be really happy to see data on the benefits the common man has derived from the tax hikes over the years thus far.

Nearly every one has taken a beating from Covid one way or another. The government should look at internal cost control and belt tightening in these trying times. I don't believe its fair to tax the hell out of taxpayers to cover the GST deficit. I am open to correct myself if presented with the right data.

[whitecloud]

Covid lockdown has not only led to loss of the government revenues but also the loss of the livelihoods for a large number of people.Hence, in order to make up for the lost revenues and to provide money in the hands of the affected people , the central govt was forced to hike the excise duty on the fuels in March & April 2020.

Besides this ,when the central govt had hiked the central excise in April 2020, the prices of the indian basket of crude were around 20 $ / barrel .Presently the prices have risen to around 40$ /barrel .Another addition to the rising fuel prices is the fall in the rupee by around 1% during the period April to June.

On top of that, the state governments levy VAT on the advalorem basis and not at a fixed rate per litre. This is causing a cascading effect on the prices of fuels .Now is the time for the central government to provide some relief in the rising fuel prices by rolling back a portion of the latest excise duty hike .

[MegaWhat]

Massive, continuous hikes in what is among the most unforgiving time we have had in recent history. Ironically, the folks who are being milked through these hikes are the ones that are among the worst affected due to COVID.

1. The folks who absolutely need to get out of their houses to work - the ones in such dire need of money that they cannot maintain the social distance. Think delivery men, small shop owners, small time sales executives and many others. Expecting them to pay up while their sales/income is lowered is mind numbing.
2. The ones who are actively helping in the current situation and need to step out - doctors, bankers, Municipal workers, infrastructure maintenance works and others.
3. The ones ensuring there is food on everybody's table and other commodities in the local shop - the logistics workers. Think all commercial vehicles.

I believe most of the middle and upper middle class has been able to sustain at home without refueling and might be able to sustain for another few months. Although I'm sure the high prices will trickle down sooner or later in every aspect of society.

I understand that the GoI needs money. And it's fine to mop up revenue when they can in times like these. What I find unnerving is the manner in which all this tax money is spent. Here's what my understanding is of most of the "stimulus":

Take money from working class folks in way of higher tax --> give it to banks to make it cheaper for them to loan it out to companies --> companies will restart operations and multiply this money --> same or more money paid back to the working class --> spurs consumption

But this relies on the below assumptions:
1. Banks will be willing to give out loans to severely hit firms.
2. Firms will start operations immediately. After all, in a market where nobody's buying, why would someone start producing?
3. Firms make a profit and are able to give back the loan and keep some money on the side.
4. Firms pay the employees at the same rate as pre-COVID times. How do you ensure that the big shots in the firm aren't keeping some extra cash while reducing incomes of folks below? After all, the times have been harsh on them as well. And it is indeed rather demanding to run a company in such uncertain times!
5. Assuming everyone is paid as before, it is another assumption that they will start spending some of that money right away.

The only certainty in the above plan is the collection of tax from the public. The rest waits to be seen.

I'm not a financial expert so this is only a laymans understanding of what seems to be happening. Do correct me if I'm mistaken.

Coming to electric vehicles, I'm sure in a year or so we're going to have new slabs for electricity used for charging vehicles. I don't think the Govt. will let such an opportunity pass easily. At this point, I think the cost of execution of such a tax system is higher than the revenues and that's what stopping them. Let's enjoy these vehicles before the tax gets there.

[AJITHAAA]

Never imagined that an Hindi lesson by Bharathendu Harishchandra would come back to haunt. 'Andher Nagri Chaupat Raja' was the lesson. Our Hindi Pandit teacher who was a kannadiga used to reprimand us calling 'Andher Nagri ke Gadhon'. It was funny then but sadly a reality now.
p.s.: Moderators, please excuse if it is inappropriate.

[the.shivaraj]

I think the Government is taking advantage of the current situation. Due to the pandemic, most commuters are opting for a personal vehicle. Even I am averse of using public transport. But still, I guess the fuel tax collection is nowhere is near the pre lockdown phase. This is mainly due to the fact that most of us are working from home and IT companies have suspended cab services. If the prices rise every day it leads to inflation ultimately. The hike is pinching me as well and I have started using my Aprilia 150 or Trek cycle for short trips. Hopefully, the prices may come down and we can start using four wheelrs.

[KGS]

My 2 cents on this topic -
While Govt of India is doing usual lip service to do everything possible to help people and economy, My opinion is they are doing exactly the opposite. Current PM and FM have no idea how to handle economy. Instead of throwing catchy phrases like 20 Lakh crore and doling out loans. They need to take some concrete measures to help people and economy. Hiking fuel prices when international crude rate is near all time low is not helping people. Country is made of people and Government is there to support us not the other way round. Currently there is no cost cutting for MPs and MLAs, everyone is enjoying their luxury.
There was one report where MPs book multiple tickets for same day travel and then let it go waste. We , the tax payers, are paying for it.

Government need to be accountable for each penny spent. Current PM devised idea to have a separate PM cares fund instead of PM relief fund to show how much he cares. But icing on the cake is there is no audit for PM cares. What is the use of creating a separate fund when one is already there and why no audit.

Today whole world is facing issues due to Covid19 , but the government which thinks about people do something like what Germany is doing to help promote business. PFB the details of proposal.

In order to boost the economy after the corona pandemic, Germany has put together an economic package worth billions. On 3 June 2020, the German parliament proposed to temporarily reduce the VAT rates from 1 July 2020 until 31 December 2020.In order to boost the economy after the corona pandemic, Germany has put together an economic package worth billions. On 3 June 2020, the German parliament proposed to temporarily reduce the VAT rates from 1 July 2020 until 31 December 2020.

Standard rate is to be reduced from 19% to 16%.
Reduced rate is to be reduced from 7% to 5%

But alas our PM cares too much to let go off his luxury and always ready to tax the people in every possible way.

PS : No offence to any of the fellow team bhpians. My views are only for the government's way of working.

[Maverift]

Originally Posted by INJAXN

Here petrol/diesel prices are inversely proportional to crude oil prices.

Inversely proportional to falling crude prices and proportional to rising crude prices

[Fernang]

I may be going off topic but shouldn't the government be already concerned that rise in fuel prices would result in an increase in the operating costs thereby impacting the prices of commodities?

Empathy is one thing that seems to be missing from the present government. The belief that the patriarch knows what he's doing and shouldn't be questioned seems to be the prevailing status quo. Anyone offering a contrarian view is labelled as the 'other' in the most unflattering way. The absolute mismanagement of the economy started way before covid-19. Didn't this government borrow, sorry, transfer Rs 1.76 lakh crore to itself from the RBI.

I'm aware that finance and economy are difficult, detailed and exhaustive topics to understand let alone manage effectively. But when smart, educated and intelligent people share few pointers on how the economy could be revived, they are mocked, ridiculed and shouted down for their views. Their suggestions disregarded.

People deserve better. And to the question 'What the hell is going on?' Looks like they want to milk the cow as long as it allows.

[Bibendum90949]

Slightly off topic



https://auto.economictimes.indiatime...itely/76547970

[Radiator]

Sorry for being OT, but the GOI just reduced Fixed line broadband license fee for telcos from Rs 800 crore/year to just Re. 1/year. This decision comes in when we are 'supposedly' running out of tax revenue. This step would result in a loss of approx 600 crores in a year and we all know the biggest beneficiary (ahem).

https://www.financialexpress.com/ind...eform/2002124/

[Tucker48]

I'm wondering what the govt will do with EVs. I mean how they will milk the cow then?

[wildsdi5530]

Somehow the main difference I see between the yea sayers and the nay sayers in this thread is whether they consider the whole quantum of revenue vs the percentage of revenue.
The guys who support the govt's stand want the quantum of revenue to remain constant or rise inspire of the reduced consumption. So even if there is one consumer, he should carry the entire burden as a tax.
This I think is a flawed way of looking at things. But all taxes in our country seem to go in the same way. 3% of the population should pay income tax equivalent to 100%. Tax from fuel and liquor should remain constant even if there is a dip in consumption.
In a capitalist democracy, when consumption decreases, tax is reduced to hopefully increase the consumption. However here it appears to be like a monarchy where the king has to have his dues no matter what state the economy is in. This is a ok when there is a benevolent ruler who gives back at times of prosperity, but not in our country where there is no single ruler but a whole population of a minor country who are ruling together and trying to fill their individual chests.