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Modi Sarkar’s fight against black money is so white, so useless!
- Published on 04 November 2014
(Image courtesy: incometaxindia.gov.in)
“The Indian government’s white paper is so white, so white, that you can’t read anything on it. So it’s useless....”
Mr. Narendra Modi stated this on 31st August 2012 when he was Chief Minister of Gujarat. He poked fun at UPA as well as sounded serious at #ModiHangout while giving three-sentence reply to a question on black money stashed abroad.
Time is ripe to spin this banter on NDA Government. Its efforts to bring back black money to the country have been so white to the point of being totally inconsequential. And the Modi Government is not hiding this truth.
Click the ‘tackling black money’ button on the home page of Department of Revenue (http://dor.gov.in/tacklebm), the viewer would find that the page was last updated on 24th April 2014 during the UPA regime!
The page captioned ‘Efforts of Government in Tackling Black Money’ displays four documents. These are: Baseline Report which was updated on 24th April 2014; White Paper on Black money issued on 21st May 2012, Government’s response to Swami Ramdev's letter to the then Prime Minister Dr. Manmohan Singh and Report of the Committee on ‘Measures to Tackle Black Money in India and Abroad’ that submitted its report in August 2012 under the leadership of Chairperson, Central Board of Direct Taxes (CBDT report).
There is nothing in the public domain that can shed light on what new action the Modi Government has taken on valuable suggestions contained in the white paper and the CBDT report.
Kejriwal has the last laugh in the murky politics of gas pricing & imports
- Published on 29 October 2014
(Image courtesy: taxindiaonline.com)
“For the overall economy to grow, India needs to do unpopular things - do things that are good for the country. What good is a mandate if you can’t do unpopular things.”
Microsoft founder and celebrated philanthropist Bill Gates reportedly said this last month while on a visit to India. This sage advice has obviously not struck the right chord in the BJP-led NDA Government.
The new Government has dropped enough hints that it cannot break free from the web of populism spawned by the UPA with both the support & pressure from the NGOs and the judiciary. The NDA Government would thus only take decisions that are perceived politically correct. It has demonstrated this through its stance on the gas pricing.
The new gas pricing mechanism has been prepared under the dreaded shadow of public interest litigants and the Supreme Court. The mechanism is a political comprise between conflicting interests of different stakeholders. It is certainly not a long-term initiative for promoting national energy security and facilitating development of integrated energy market.
Modi Government approved on 18th October certain modifications in the UPA’s convoluted gas price formula, which was contrived by a committee headed by veteran economic administrator Dr. C. Rangarajan.
The Government flaunted its commitment to populism by highlighting right in the beginning of its release the fact that “upward revision in gas prices will be approximately 75% less as compared to the price arrived at using Rangarajan formula.”
From Modi’s ‘Sauni Yojna’ to Baba Da Dabha; it is ‘Office Office’ at MOEF
- Published on 16 October 2014
(Image Courtesy narendramodi.in)
Should a village dabha owner be required to seek Central Government approval to acquire a few square metres of forest land for creating a new access to his food outlet? Should his application not be cleared at the district level? Is it not good enough for the owner of Baba Da Dabha in a Punjab village to support his application with 10 documents. These include separate assurances to pay for compensatory afforestation (CA) and make additional payment for the forest’s net present value (NPV).
Should the nodal officer of the Ministry of Environment and Forest (MOEF) have returned his application with the objection - “geo reference map not enclosed; project site not visible on survey sheet”? Does MOEF expect a villager to submit geo reference digital data as mandated under its order issued in July 2011?
The Union Minister for Environment and Forest, Prakash Javadekar, must ponder over these issues as more than 50% of the forest clearance applications filed since 15th July 2014 have been returned to applicants with one objection or the other? Some of the objections are friovlous.
The returned proposals include Sauni Yojna, the Prime Minister Mr. Narendra Modi’s dream project to bring Narmada flood waters to drought-hit Saurashtra region in Gujarat. Another similar, returned project is named Pokaran Falsoond Balotra Siwana Lift Water Supply Project that would bring potable water to three towns and 563 villages in Barmer & Jaisalmer districts of Rajasthan.
Many of the returned applications envisage acquistion of a few square metres of forest land. Baba Da Daba, for instance, requires diversion of 0.0040 hectares of forest land at Village Tanuli in Hoshiarpur district of Punjab.
The World Needs Radical Tax Expenditure Reforms
- Published on 12 October 2014
(Image Courtesy: US GAO)
The over-reliance on tax incentives/tax expenditures as an instrument for guiding socio-economic development, coupled with their flawed implementation, has transformed it into a big mess across the world.
The muddle is manifested by complex tax regulations, tax disputes including litigation at the national and global level, crony capitalism and uncertain business environment across the globe. Instances of mess are aplenty as we will find later in this column.
And the mess is becoming messier with policy-makers focusing more on curbing clever use of multiple tax incentives instead of reducing them to bare minimum and aligning statutory tax rates with the effective tax rates.
The OECD-spearheaded Base Erosion Profit Shifting (BESP) action plan, General Anti-Avoidance Rules (GAAR), transfer pricing rules, Minimum Alternate Tax (MAT) and retrospective amendment to regulations are nothing but reactions to astute usage of tax incentives by the companies.
There would have been no need for such negative strategies and the resulting complexities had the Governments kept tax structure simple and free from clutter of tax incentives that are subject to many conditions and interpretations.