Ashneer Grover Exposes the Punitive Reality of India's Tax System
Ashneer Grover's Vision for Tax Reform in India
12 June 2023
Ashneer Grover criticizes the Indian tax system, stating that taxpayers are essentially engaging in charity without receiving tangible benefits for the significant percentage of income taken by the government.
Grover highlights the disparity between entrepreneurs and salaried employees in terms of tax evasion, with entrepreneurs finding ways to evade taxes while salaried employees have little choice as tax deductions are made at the source.
Grover advocates for a lower income tax rate of 10-15 percent for everyone, coupled with measures to prevent tax evasion, increase tax revenues, and promote compliance with a fair and reasonable tax system.
The tax system in India has long been a topic of contention, with critics arguing that it is inequitable and burdensome. Ashneer Grover, a notable entrepreneur and former judge on Shark Tank India, has emerged as a prominent figure in this discourse. Through a series of viral videos, Grover expresses his belief that paying taxes in India feels more like a punishment than a way to contribute to society. He highlights the substantial portion of income that the government claims without offering tangible benefits, leading many taxpayers to question the fairness and effectiveness of the current tax structure.
According to Grover, taxpayers in India are essentially engaging in acts of charity without reaping significant rewards. He draws attention to the lack of benefits received in exchange for the 30-40 percent of income collected by the government. Grover poses a thought-provoking question, asking how many months of the year individuals are effectively working for the government rather than for themselves. He argues that this prolonged dependence on the government is akin to a form of servitude and calls for a reevaluation of the existing system.
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Grover points out a notable disparity between entrepreneurs and salaried employees regarding tax evasion. Entrepreneurs, who better understand the tax system, often find ways to evade taxes. On the other hand, salaried employees have limited options as tax deductions are automatically made from their income at the source. Grover perceives this as a punishment imposed on salaried individuals, who not only have to contend with income tax but also bear the additional burden of an 18 percent Goods and Services Tax (GST). He questions whom individuals are genuinely living for when such a significant portion of their income is taken away.
Looking towards the future, Grover prioritizes a lower income tax rate if he were to enter the realm of politics. He believes that by establishing a flat tax rate of 10-15 percent for everyone and implementing stringent measures to prevent tax evasion, the government could increase tax revenues. Grover argues that individuals would be more inclined to comply with a fair and reasonable tax system, thereby reducing the incentives for tax evasion.
In response to a recent government notification, Grover critiques the increased Tax Collected at the Source (TCS) rate of 20 percent imposed on international credit card transactions. He highlights the irony of tax exemptions granted to political donations while subjecting credit card transactions to higher tax rates. Grover questions the rationale behind this discrepancy and suggests the need for a more balanced approach to ensure fairness and equality within the tax system.