The taxing season

Seems to be a season of additional taxes. Everyone is talking about some additional tax. PMC is considering adding vehicle tax to reduce the number of vehicles coming on road everyday. On the similar lines even the state government is thinking of adding congestion tax Mumbai residents.

Every individual is already paying up a huge amount of tax for each and every thing that he/she uses/purchases. Here is a list that directly affects a salaried person:
  1. Income tax - largest portion on the salary goes under this head
  2. Sales Tax - on every legal purchase, you pay this tax
  3. Service Tax - Many of the services are under this head.
  4. VAT - This was supposed to reduce the tax we're paying. However, what I have observed is I have started paying VAT even on the food items purchased in restaurents, which was not there earlier.
  5. Education cess - Many of the tax categories are levied with this cess.
  6. One time road tax - when you purchase any vehicle, you pay a lumpsum amount.
  7. Road Toll - At various places on highways/bridges, users end up paying this toll.
While I don't have objection to many of these taxes, my main worry is whether this money reaches back to the people in the development form. It seems, however big amount we'd pay towards income tax, the IT department would remain always hungry. While the big fishes (read tax evaders) escape easily, the common man is squeezed to the last penny in every possible manner.

The main purpose of tax is to provide facilities to the citizens, and if government is failing to do that because of the inefficiency or corruption, increasing the tax is not the way to go.

Now let 's see if the newly proposed tax by PMC would be effective or not. A four wheeler costs from 2.5L upwards. Now, even if you add 10-20K of new tax, would people stop buying the 4 wheelers? No. If PMC proposes to charge upwards of 50K as charge, I am sure the automobile lobby will not allow the authorities to do that. So, it would just serve as additional income to the PMC, 10-20K per vehicle, and would not achieve it's main purpose.

Instead, PMC should really concentrate on improving the public transport system and that is PMT. PMT should be strengthened in terms of
  • New units in the fleet
  • efficiency of the staff
  • politeness and service oriented attitude in the staff
  • cleanliness.
  • Reliable frequency
If these simple things are done, many of the Punekar's would revert back to this public transport system and it will automatically reduce the number of vehicles coming on road.

It's high time that the authorities undestand increasing the tax is not the real solution. They need to be creative, innovative and address the root cause not the peripheral issues.

BTW, any idea what is the state of BRT these days?


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