We all appreciate the hard work put in by Prime Minister Narendra Modi. I am blessed to be followed by him.and appreciate he acknowledges my advice always
I always try and speak with people on ground and judge the mood. Also as a Finance professional I can understand the brilliant economic steps well balanced by control of fiscal deficit.
I understand that in current budget Mr Arun Jaitley had to walk on tight rope of deficit and tax exemptions.Now the high crude prices and MSP is also another worry and may work against government goal of fiscal prudence
Although GST collections on monthly basis is around 96000 crores, government shall need around 1.03 lac crores in next 8 months to keep fiscal deficit under check
The collections may experience some setback with revision in rates. It is not easy to change the mindset of many who spend on luxury items from dealers and do not go for invoice to save GST.
I understand that the government is doing needful checks and bringing guilty to books, however it is difficult to check every shop and buyer
It is also being proposed to give GST a boost by refunding the tax on digital payments. However the same is limited to Rs 100. For those who are splurging on luxury items will not bother for Rs 100 refund
The collections may experience some setback with revision in rates. It is not easy to change the mindset of many who spend on luxury items from dealers and do not go for invoice to save GST.
I understand that the government is doing needful checks and bringing guilty to books, however it is difficult to check every shop and buyer
It is also being proposed to give GST a boost by refunding the tax on digital payments. However the same is limited to Rs 100. For those who are splurging on luxury items will not bother for Rs 100 refund
A small suggestion with which we can reap triple benefits of huge revenue to government,Relief to middle class coupled with huge boost to consumption. I shall call it Golden Triangle of Finance.
" Splurge in luxury of branded clothes, watches, mobiles, laptop, travelling................... AND get Tax Relief of Rs 1 lac from income tax "
The caveat : Has to be for end user, digital payment and not for those claiming GST input credit.
This will change the entire mood of nation with huge boost to economy as well as GST revenues
Check rough calculations for the same
The above proposal can be adjusted as per various financial brains in MOF. This is just an out of box suggestion after the ground feedback
Check rough calculations for the same
Let us all work together to make India Golden Bird again
Its a Marvellous idea with a win-win situation for all.👏👏👏
ReplyDeleteWe discussed similer point in our pune meet that give some benefit in income tax
ReplyDeleteGood option, if it's implement will give good results
ReplyDeleteBut this expenditure based exemption of₹1lakh will reduce investible surplus ,thereby reducing Saving rate, which is already falling..That will be catastrophic for fall in Investment..
ReplyDeleteThis will be counterproductive.. Reducing Direct Tax with Indirect tax, is against cannons of taxation , as IndiretTax is never Equitable
ReplyDeleteMam, I am not expert on this issue but from what i can understand from S gurumurthy sir, he says that savings will help india grow. He further says that it is infact savings which produced 9.5% growth.
ReplyDeleteAs you can understand economics better than me, please clarify will this not come against what s gurumurthy sir says.
https://youtu.be/IvXkSkEappo?t=2069
Its a Very Good idea with a win-win situation for all.
ReplyDeleteKeep minimum taxable income slab same as of now.
ReplyDeleteExpand Slab limits.
Change Income Tax Rate to start from 1%
Followed by say 3,5,10,12.5,15,20,25%
Total Tax slabs may be 5 to 8
Maximum Personal Tax Rate 25%
Encouraging compliance.
Could you please calculate impact on change in Revenue from Income Tax ?
I think people having Rs 10Lakh income must be soending Rs. 1.00 lakh approx in trvelling cloth watches mobile or laptop for their own use or to gift in different occasions even today, They are buying it means they must be paying GST also on these items. So I could nit understand who will it help? Can you please help to to understand
ReplyDeleteOn What basis to you propose to give the deduction of Rs. 1lacs.
ReplyDeleteHarshad