In this post, we will discuss about how we can make all the eligible income earners to pay tax.As a pre-requisite, we need all citizens of india to declare their present wealth. For that, we need a system called Wealth Repository. This Repository will contain all the individuals movable and immovable properties, like House, Land, Car. The price of the House you own will be declared by you. If you declare the price of your home to be 15 lakhs and pay certain tax. It will be kept that way. But if you say in 10 years, you want to sell it to another person for 60 lakhs. We will calculate the tax paid by you 10 years before and will tax the appreciation based on the present price you declare. The lock here is that, You cant bring money into your Wealth repository without paying tax for that amount. This is still a grey area, with lot of loopholes. We need to bring reforms to property tax also, simultaneously. If you have not declared any property ( movable or immovable ) in this repository, simply it does not belong to you. Government will simply take away anything you have not declared.
Next, Income tax. You have to declare your income, which will be recorded in your Wealth repository. It should be less than your expenditure in that year or you have reduced or shifted your wealth form one property to other and clearly declared in your wealth repository. So now, how to track your expenditure. All citizens of India or a particular state you want to start implementing this idea, should have Aadhar Card with electronic chip embedded in it, like a credit/debit card. It will simply hold your Aadhar Number electronically embedded. Every shop in India, which sells products worth more than a single item worth 1000 rupees, should hold a Aadhar Reader. This Aadhar Reader will read the Aadhar Card and will have a finger print reader which can be attached in smart phone and connected to wealth repository through government app. So if a person comes to a shop, he has to produce the Aadhar card and put his finger print. Amount you need to pay can be any mode debit/credit or simply cash. This reader will record your expenditure in your respective wealth repository and produce the bill with your Aadhar number and Expenditure code attached to it. Any bill ever produced in that country without this Aadhar number and Expenditure code is illegal and be punishable under law. If you produce a bill, no matter what is its price, should have this code and number. But, if you don't produce a bill, there is an exemption till 1000 rupees. This is mainly for small payments in petty shops. The disadvantage here is that, you can't return a product or claim for damage. since there is no bill and the shopkeeper can simply shoo them away. From 1000 rupees to 5000 rupees, there is no need to put details of the purchase, only enough to say, 4034 rupees in Saravana Stores, Chromepet. Above 5000 details purchase details should be mentioned. No product without bill ever be considered for Warranty/Guarantee, replacement for damage or in Company owned reapair centers like Samsung Care. All the information about your transactions will be in wealth repository and can be viewed only by the person and the governement. Ofcourse, RTI will get this detail of politicians' wealth repository( only total wealth) to public. In case, you demand privacy (even from your family members), any bill on producing 2% of the amount can be made discreet. That is if you purchase a property for a second wife for 10 lakhs and pay 20,000, it will be made discreet and will be visible only to government. But total wealth will be added.
This gives the 10% of the reforms to be done. Lot of areas like family wealth, Industry wealth and so and so needs further to be discussed.
Next, Income tax. You have to declare your income, which will be recorded in your Wealth repository. It should be less than your expenditure in that year or you have reduced or shifted your wealth form one property to other and clearly declared in your wealth repository. So now, how to track your expenditure. All citizens of India or a particular state you want to start implementing this idea, should have Aadhar Card with electronic chip embedded in it, like a credit/debit card. It will simply hold your Aadhar Number electronically embedded. Every shop in India, which sells products worth more than a single item worth 1000 rupees, should hold a Aadhar Reader. This Aadhar Reader will read the Aadhar Card and will have a finger print reader which can be attached in smart phone and connected to wealth repository through government app. So if a person comes to a shop, he has to produce the Aadhar card and put his finger print. Amount you need to pay can be any mode debit/credit or simply cash. This reader will record your expenditure in your respective wealth repository and produce the bill with your Aadhar number and Expenditure code attached to it. Any bill ever produced in that country without this Aadhar number and Expenditure code is illegal and be punishable under law. If you produce a bill, no matter what is its price, should have this code and number. But, if you don't produce a bill, there is an exemption till 1000 rupees. This is mainly for small payments in petty shops. The disadvantage here is that, you can't return a product or claim for damage. since there is no bill and the shopkeeper can simply shoo them away. From 1000 rupees to 5000 rupees, there is no need to put details of the purchase, only enough to say, 4034 rupees in Saravana Stores, Chromepet. Above 5000 details purchase details should be mentioned. No product without bill ever be considered for Warranty/Guarantee, replacement for damage or in Company owned reapair centers like Samsung Care. All the information about your transactions will be in wealth repository and can be viewed only by the person and the governement. Ofcourse, RTI will get this detail of politicians' wealth repository( only total wealth) to public. In case, you demand privacy (even from your family members), any bill on producing 2% of the amount can be made discreet. That is if you purchase a property for a second wife for 10 lakhs and pay 20,000, it will be made discreet and will be visible only to government. But total wealth will be added.
This gives the 10% of the reforms to be done. Lot of areas like family wealth, Industry wealth and so and so needs further to be discussed.
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