[The Rationalist]

On a lighter note, only 2 countries run their economy on crude oil, Saudi Arabia who excavates out of the land and India who excavates out of people's pockets! Saudi Arabia may have a plan B for the day they run out of Oil, I'm not sure whether we have. Maybe the government will increase the tax on electricity and solar panels!

[Balthazar]

Just saw an article that said Pakistan has decided to hike their fuel prices by upto PKR 26.

The new rates are PKR 100/L for petrol, PKR 101/L for diesel.

You folks want to know how much it equates to in INR? Its around INR 45 a litre for petrol.

Before this hike, a litre of petrol in Pakistan was PKR 33/L.

When was it that fuel was in the 30s here? 2 decades ago?

[NiInJa]

I am going to tell some of my personal experiences and let others decide what to do with it.
I can summarize only one thing: Most Indians are selfish and don’t think of nation’s well-being in general and this leads to such painful decisions of milking aam-junta.

Instance 1:
Recently bought an office chair for my wife. The seller quoted 4700 Rupees without a receipt and 5600 with a receipt for which he would have to pay GST. So its obvious that I would buy the chair for 4700 Rs right ? I did not. But how many Indian’s actually pay more just to have the transaction recorded? If I were to pay 4700 by paytm/GPay, the seller asked me to transfer it to his daughter’s account. A small chat with my dad on this incident revealed me that this sort of practice is rampant in infrastructure projects too. (He has spent his entire career in Road construction). Many people just evade taxes by doing such shady transactions. Now, most people might not be aware of ground realities but in tier two cities and villages, such small businesses like selling furniture, electricals or other goods like selling cement/ bricks etc has a huge turnover, but the government does not get enough tax since for example, these guys show we sold 5 cement bags this month but in reality they had sold 5 through right means and 25 others through their daughters’ and other relatives’ account. Heck, they also employ good Chartered Accountants to make all this look perfect.
One of my colleagues had a legacy of CAs in his family who worked for small business-men, but then left his family business of CA firm to join IT Industry simply because he could not digest the ‘afra-tafri’.
Again, there are always going to be exceptions, but that fact is government loses a lot of revenue on such transactions.

Instance 2:
Outside our office, there was a small paan shop, where people would line up for buying cigarettes and having tea. We casually asked how much he earned and he said somewhere around 40-45,000 per month. Of-course he would be there from 9 AM to 11 PM except weekends. A Fresher’s salary in IT industry is around 20,000 per month after some deductions like PF. Who thinks the paan shop guy is actually paying taxes? One might actually look at him and say how poor this guy is. This was back in 2010. When I went to my old office last year I saw that guy had purchased two shops right in front of the main building (the cost of the shops, by the way, would be in crores). He has expanded his business to selling snacks along with tea and cigarettes. Worked out well for him, but how did it work out for the government ?

Instance 3:
Cash transactions: Many sweet shops in rural areas/towns deal in cash. The small town about 120 kms away from Delhi where my in-laws stay has a very famous sweet shop who specializes in Cashew sweets. Almost all of his transactions are in cash and he has made a fortune out of it. In small towns, such people are very famous and everybody knows how many properties and cars the owners have bought over the years, my brother in law is a lawyer and he has been involved in some of his land deals, he has told me how much ‘earning’ they actually show on paper. Many salaried people don’t know what their actual turnover is, until historical events like demonetization occur.
Our regular medical shop owner was sitting on a pile of cash worth 2 crores then and was pretty nervous about what to do with it, the reason he disclosed that to my dad was funny: he was not accepting a 500 rupee note and unloaded his frustration on my dad. Imagine if he were to show that as earnings, how much tax he had evaded so far. Now apply that to as many small shops you can see.

When I was standing in the queue to take out some cash from lockers during the demonetization period, the doctor couple who was standing ahead of me were carrying two laptop bags came out of the bank with their bags so full that they were looking like donkeys hauling something heavy. Again, if one can stack up wads of currency notes in their lockers, its fairly easy to understand how much tax they must have saved/evaded as their medical practice is the only source of income.

Instance 4:
My very close friend’s father-in-law is a farmer and is involved in cultivating sugar-cane. He is filthy rich as his farmland falls in the ‘sugar belt’. Not to mention his political connections. Yet, he was crying when Maharashtra government decided to wave off loans but by doing it through a proper online channel and verification. He shows himself as a ‘farmer’ and takes advantage of all subsidies and tax exemptions etc. Why ? Just to tell, while there are a lot of poor farmers, there are some who make a lot of money, drive their white Fortuners with blacked out windows but won’t pay any kind of taxes.

The reality is that if we people were to pay taxes honestly, governments would not have to increase fuel prices or prices of liquor during such trying times.

[nandrive]

Originally Posted by NiInJa

Instance 4:
My very close friend’s father-in-law is a farmer and is involved in cultivating sugar-cane. He is filthy rich as his farmland falls in the ‘sugar belt’. Not to mention his political connections. Yet, he was crying when Maharashtra government decided to wave off loans but by doing it through a proper online channel and verification. He shows himself as a ‘farmer’ and takes advantage of all subsidies and tax exemptions etc. Why ? Just to tell, while there are a lot of poor farmers, there are some who make a lot of money, drive their white Fortuners with blacked out windows but won’t pay any kind of taxes.

Yes you are correct, I am a farmer as well and I know the ground reality. There is a high probability that the said person would be holding even a BPL card.

[Balthazar]

Originally Posted by NiInJa

The reality is that if we people were to pay taxes honestly, governments would not have to increase fuel prices or prices of liquor during such trying times.

So let me get this straight.

The crux of your argument is because my govt. has not developed an efficient system of tax collection with a set of easily enforceable provisions to act as a deterrent and dissuade tax evasion, charging exorbitant taxes on essentials like fuel is justified.

I have come to hate this apologist argument. If the problem is in tax collection, then the solution is to come up with a better system, expand your IT infrastructure, hire more taxmen, conduct more audits, raid more businesses, get revenue intelligence from the ground, so people like the fortuner driving farmer and crorepati paan-waala are caught, educate people about how their taxes are used, how they benefit the country. The solution is not to do grade A mental gymnastics to justify taxing essential commodities because the govt. can't do their job and collect their revenue.

The failure lies with the govt, not with the people. If studying criminal psychology has taught me anything, it's that people are inherently scummy, selfish, self absorbed and short sighted.

It's the job of the govt. to go out and get what they are owed, not use jugad and say; you know what, reforming our tax structure is too much work, let's just take the easy way out and tax people out their butts for essentials like petrol.

[TokyoDrifter]

There’s been a halt to the daily price increases. After 21 days of continuous price hike, fuel prices stay put for today, as they were yesterday!

Is this the end of the trend? Monday morning will tell.

[for_cars1]

Originally Posted by NiInJa

.....

The reality is that if we people were to pay taxes honestly, governments would not have to increase fuel prices or prices of liquor during such trying times....

Originally Posted by Balthazar

...then the solution is to come up with a better system, ... it's that people are inherently scummy, selfish, self absorbed and short sighted.

It's the job of the govt. to go out and get what they are owed, ...

I like both sides of this argument. The first quote highlights harsh undeniable realities.
The second quote has the real solution.

Human mentality is the same worldwide, the need of the hour is foolproof tax collection.

If the Government wants to collect Income tax at source, then they got to identify the real earnings of and collect from everyone and not just fleece salaried people just because they are easy targets.

If Govt is unable to collect Income tax from business folks, then stop collecting Income tax from the 1.5% tax paying salaried folks well.

The root cause of the problem is lack of ruthless tax collection from all the target earning sources. This has to be corrected big time. Only then these exorbitant taxes by fleecing few target areas can be brought down.

[drmohitg]

Originally Posted by NiInJa

I can summarize only one thing: Most Indians are selfish and don’t think of nation’s well-being in general and this leads to such painful decisions of milking aam-junta.

The reality is that if we people were to pay taxes honestly, governments would not have to increase fuel prices or prices of liquor during such trying times.

Couple of points I want to make.

1. Is this a new phenomenon? Tax evasion is rampant across the world. Even people paying taxes try all the means available to them and eventually pay taxes on the bare minimum that they can manage to achieve. Rent receipts, fake chemist bills and what not. Corporate sector companies and employees are no saints. But this has been the trend since ages. So how can this suddenly become the narrative of the day and drive fuel prices up north so sharply? Did the government wake up now to realize that the mithaiwala is not paying his taxes and hence they need to raise fuel prices?

2. What has the government done to address this? And if you are unable to solve this or feel that the process is too tedious then your solution is to raise taxes on fuel exponentially? Why not instead cut down on your spending? And it isn't like you spend only on building hospitals and roads. There is a whole list of things and areas where you can cut down your spending. I would not repeat that list but we all know it.

The other thing is this whole war rhetoric that is being touted as the reason behind raising taxes on fuel. India and China are NOT AT WAR. Period. Atleast not yet. The present day issue at best can be described as a skirmish. With all due respect to the soldiers, we lose more lives in Kashmir orNaxal areas every few months than here. And is this the first time we saw some action at the border? For the sake of common sense, we have fought multiple wars, proper wars which lasted for days where the whole country's defence machinery was involved. The current day skirmish is at best a 2 on 10 on the scale of those wars. But for the first time, I can see this being touted as the reason for fuel hikes.

This government has kept on raising prices ever since it came in power. The reason before was that the day our country faces a challenge, all that extra money would be useful as a cushion. 6 years of all this extra cash in a fully functional and thriving economy! And yet when the time came when everyone could do with some savings, you raise prices again citing new reasons.

Lastly they say that fuel is selling less so they are losing on the revenue. But what about the global crude price. It has fallen to unprecedented levels. And since we are still paying prices that were being charged when global crude was 5-6 times costlier than today. So what about all that extra profit? You don't need to sell more when your profit level has grown exponentially.

[ramzsys]

Originally Posted by drmohitg

But what about the global crude price. It has fallen to unprecedented levels.

If only members could stop treating it as a venting thread.

[drmohitg]

Originally Posted by ramzsys

If only members could stop treating it as a venting thread.

Data is a two way sword. So quoting one line and conveniently labelling it as venting is .



In the meantime prices have been increased again today!

[JithinR]

CJI of India showing us the way on how to contribute to our national defense budget to give a solid answer to China (/s).

I will stop here to avoid antagonizing some of our fellow members. Definitely, don't try to see the owner of this bike using the registration data because that will....oops!

Source: https://twitter.com/SaketGokhale/sta...885052929?s=19

[NiInJa]

Agree with all arguments made to my post. I am against fuel hike too. It was just an attempt to show how deep a mess we are in where all governments havent put a robust mechanism to check tax evasion and nor do some people have the mentality to think about nation as a whole when they employ such tax saving measures.
I do remember late FM Shri. Arun Jaitley saying that if GST collections reached the levels of 130L crores(current avg is approx 95L crores), the goverment would probably not increase duties on fuel the way they have to do it right now.

[Durango Dude]

...So what do you do: You penalize the taxpayer and those who live of him...

[drmohitg]

Originally Posted by Durango Dude

...So what do you do: You penalize the taxpayer and those who live of him...

You can see it across all platforms. Prime example is pollution issue of Delhi. Absolutely zero steps have been taken on the ground apart from making committees and 1 MP installing a so called giant air purifier. Winter is coming in 3 months and we will be back with the usual political blame shifting. All they really did was ban diesel and petrol vehicles of certain age. The other example I can think of is the women safety. They banned sun films. Any other real steps taken? Crimes against women have only increased. They constantly punish 1 section of the society for every one of their deficiency.

And BTW this post is venting!

[Balthazar]

Originally Posted by ramzsys

If only members could stop treating it as a venting thread.

I thought everyone remembered when you could get a barrel of West Texan Intermediate priced at negative $38. That was just a few months ago.

The oil industry collapsed and what did the government do?
They responded by doing absolutely nothing for the consumer. I think they may have even increased the prices slightly then too.