Last month end, was the deadline to pay our income tax and oh boy, the Income Tax department was on a massive overdrive, spamming our phones with continuous short message service (SMS) and barrage of emails reminding you to pay your taxes before the deadline. Imagine those that sleep with their phones and notifications on, only to find out the Income tax department is bothering them with messages even at 3 am. So much so for a good night sleep. Worse, the messages don’t stop once you have filed your returns. They keep coming with a caveat to ignore the message if paid, so much so for all those announcements of artificial intelligence being applied by the department.
Come August, the Income tax department must be a satisfied lot, now that the filing of taxes is over. Early birds have already received their refunds, but late-comers will start receiving refunds soon, stupidly enough we will all be a happy lot, pleased that the government has paid us some money, not even realizing it is our own money in the first place. Unfortunately this year most are not getting the refunds, according to data released by them, around 4.65 crore persons paid no tax out of the total 6.77 crore tax payers. By the way in 2019, people with zero tax liability stood at 2.9 crore, which means more and more are going through the motions of filing returns for the sake of filing, thereby wasting the time of the country and hampering their own productive growth.
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So why does the government insists these 4.65 crore Indians with zero tax liability file returns if the government will not collect any tax from them. Is the government hoping their income will increase one fine day and they start paying their taxes? Actually this data point exposes the fact that even though the Indian economy is doing well, it is not reaching most Indians, as intended. When more and more people fall out of the tax bracket it means the tax department is wasting their time in search of crumbs, which in any case hardly adds anything to the government kitty. Fine, they might be in search of those Indians whose revenue is basically in cash and don’t show it as their actual income, but is it correct to inconvenience so many Indians just to catch a few of the notorious ones.
For your information only 32,937 Goans have filed their returns this year. It means, only these many are carrying the extra burden of taking care of Goa’s government expenses as their incomes gets targeted. Of course every Goan pays tax in the different forms other than income-tax while they consume goods and services in their personal use. Is it now time to relieve these 33,000 odd Goans from paying anything? If at all Income tax is needed then just keep one slab of tax for income above one crore, and free your citizens to do productive work, thereby helping the nation.
Most tax free nations are thriving because it gives its citizens the freedom to earn without the worry of taxman interfering in their affairs. Of course the government needs money to run the country and that is collected mostly through the expenses they do. Unlike India which has tax on your income, expenditure and also on your payments. Paying taxes on every type of transaction eventually does more harm than good. It destroys the morale of the citizens especially when corruption still flourishes in the country.
Citizens must note that just by voting out the corrupt does not mean your tax money is put to good use and your job is done. It is a continuous process of observing the politicians as to what they are upto, for all you know after winning the election the politicians makes a deal with the corrupt taking advantage of your lax attitude. Of course if you start hero worshipping your politician and start justifying every action your hero takes, then nobody can help you.
Take the Income tax department’s example, if media reports are to be believed, it seems they are going to weed out all fake invoices tax payers file to bring down their tax liability with the help of artificial intelligence. In other words, the Income tax department does not trust your submissions, not to say that there will be no cheaters, but to say that every tax payer cheats the system by default, is an insult to the honest hardworking citizens, especially to the meek salaried class whose scope of cheating in any case is too low. So, if the Income tax department does not trust your word, why should you completely believe that the politician is putting our tax money to good use? Does it not become our duty to watch where your money is spent?
In a way, the Income Tax though behaviour should at least now stir up the meek citizens so as to demand work and monitor the allocation of government funds. Artificial Intelligence is most welcome if the government is going to track tax-payers social media posts, bank accounts, forcing people to link their Aadhar cards with what not. But this has to be followed up with the help of the same Artificial Intelligence and an easy to understand format on how government uses up our tax rupees. No point ensuring compliance in tax paying and allow noncompliance in tax spending.
Income Tax payers are small in number compared to the entire population and they are hardly vocal. Therefore successive governments just choose to ignore this group. Within the group the salaried class is the most submissive, therefore the government pushes them even further. Leave aside one media mention, the country hardly talks about the highest tax payer, but at the same time is ready to hero worship of the highest tax spender. Isn’t it wired?
(The author is a business consultant)
