Tuesday, February 17, 2015

Tuesday, February 10, 2015

Real Challenges of AAP

1. One Man Show:
How will AAP get over it? its not what AAP would want to survive with
2. Sustainable system change to corruption:
Though AAP won capitalising on 49 days rule, fact is that corruptions came back immediately after the last AAP fell. Infact am not even confident of a Lokpal fixing corruption, it would also work only until AAP is in rule. The real solution is having a collective social conscience which works consistently to repel corruption from society. Am not aware of a lokpal that keeps corruption low at US. In my view, its not Lokpal but the AAP, the real solution that should expand. So how will AAP convince the hardcore supporters of other parties who are worried about the loyalty than about real issues of the day?
3. Money
AAP could manage only 50% of their target 30cr this election, where and how will they get money from to expand to other states?
With the amount of creativity, intelligence and eagerness to learn, am hopeful of AAP leading the show

Brief of Direct and Indirect Taxes in India

Nature of taxes before 1991
1. Highly complex excise and custom duties with lots of exemptions
2. High peak income tax with a max of 80%
3. Very low tax payer base since low income consumers are more
4. Sales tax cumulation made the final cost of production very high
5. Low tax payer compliance
All above led to reduction in total tax collection year on year
In 1991, the government set up a special committee, the Raja Chelliah Committee on Tax Reforms, to review the country's tax system. Its mandate was to make recommendations to make the tax system more elastic and broad based, and to suggest means required for simplifying existing laws and regulations to facilitate better enforcement and compliance.
The government has implemented a large number of recommendations such as:
1 drastic reduction in customs and excise duties
2 lowering of corporate tax rates
3 simplifying income tax return filing procedures
4 levying taxes on services like insurance, stock brokering and telephones.
5 Increase the tax payer base
6. Reducing income tax rate and have slabs

“Chelliah’s recommendations is instrumental in bringing down the peak income tax rates from about 80 per cent to a simple and easy-to-administer three rate regime with the peak rate currently capped at 30 per cent,” said Pulin Nayak, of the Delhi School of Economics who have worked closely with Padma Vibhushan recipient.

Over a period of time, service tax expanded to many areas and increased, currently it applies to all services that are not part of the "Negative List"

VAT - governed by state govt
The rates can be as low as 5 percent and as high as 20 percent depending upon the states. Moreover, VAT for food items and drink are different. Many restaurants might club food items and drink and charge a flat rate on the total bill. In such cases, it is good to ask for separate bills for food and drinks. This should clearly show the different VAT for both the items.
TN VAT rate:
Where hoteliers etc do not exercise the compounding option, the VAT rate will be 12.5 per cent of taxable turnover in the case of recognised star hotels and four per cent in the case of others.
Service Tax - governed by central govt.
Service tax is same in all states. It is 12.36 percent on the 40 percent of the bill ( = 4.94 percent on the total bill). Hence whenever you see service tax on the total bill exceeding about 5 percent, you can question it.
In my specific case:
4.94% service of total bill + 12.5% of VAT on Food + 20% on special (drinks in my case I guess)
= total 83
Source: Internet
1. http://www.moneycontrol.com/master_your_money/stocks_news_consumption.php?autono=927376
2. http://www.indolink.com/consulate/iebo/indtaxid.htm

Disclaimer: Please refer the above details at your own risk. I do not claim any accuracy of the Information provided above and also not liable for any loss in any form on the usage of the above information by any person or organisation or anyone or anything in any form.