Its a tough or almost impossible decision for the political system to completely change from the existing economic policy. The element of risk involved, social and national turmoil that would take place due to this unique scheme, would make it an extremely tough decision. Add to that, the general feeling of a successful economy in India as compared to the rest of the globe and no political, media or administrative leader would venture into such a transformation, whatever its merits, unless the environment changes drastically.
In this scenario, I would put forth for a discussion- a phase wise scheme (phase one and two could be interchanged
1. A Transaction Tax of 0.5 % to replace the GST of Centre in April 2013 (This would subsume excise, value added tax,service tax, countervailing duties etc and thus reduce prices of goods and services leading to a feel good factor for TT)
2. Reduction of the highest denominator to Rs 100 in December 2013 (This would deal a body blow to the parallel economy and lead to great public support)
3. Additional Transaction Tax of 1.5% to replace all taxes save customs, reduction of highest denominator to Rs 50 and parallel announcement of a social security of Rs 2500 to all in April 2014(The success of the first year and the hugely popular social security, close to General Elections would make it possible).
Do give your views..
Regards,
Mayank gandhi.
Arthakranti proposal - Phase wise? Is it possible or desirable?
ARTHAKRANTI proposal is a product of a study of 12 years and was found fault less by North Block. Most of the authorities from academic circles and professionals have validated it and showed their full support in favour of the proposal. It has been supported by many eminent politicians. Only point is that we need to create public voice, which may get highest priority and political attention. IT IS ONLY A PERCEPTION OF FEW THAT POLITICIANS DO NOT WANT THIS PROPOSAL TO GO THROUGH.
Regarding comparison of GST with Arthakranti proposal, IT is not based on rationale, for, -
- AKP Proposal is for complete correction of Indian economy in a definite time frame, respecting constitutional frame-work.
- GST is only a fiscal simplification.
- It is up to individual's perception to evaluate the time frame and seriousness of stage of economic cancer which may swallow the country.
- ARTHAKRANTI's perception is “TODAY’S OPERATION, TOMORROW'S WILL BE A POSTMORTEM".
- AKP welcomes each and every suggestion in the direction which may take least time to get the AKP proposal implemented. However, AKP do not support the ideas which are not in form of concrete proposal like AKP one.
- AKP proposal is complete cure for economic cancer and not just a pain killer giving temporary relief and thus, it cannot be seen as a tinkering tool.
- On evaluation of grim economic condition of India and governance fiasco, a courageous stand for right and complete treatment is a must.
First things first
Dear All,
I understand this thread as an earnest effort intended to get Arthakranti(AK) proposal accepted & implemented ASAP. Respecting that, here are some comments
About GST & bank TT:
* About GST being looked at as intermediate substitute/proxy for TT => it can NOT be. GST will be applicable only on consuption, however applicability of Transaction Tax is quite wider, because it is a tax of any transaction through banks, whether it is for consumption or not. So GST cannot make up for or cannot represent bank TT! And moreover, with one unit of consumption, GST will be applicable in same extent for all...the poor and the rich. So it is very unfair for the economically lower class of society. So again GST cannot be looked at as substitute for bank TT.
About implementation transitional plan:
* I guess the transition plan for implementation was not put down intently to avoid the unnecessary debate about how to implement it, even before taking up the decision to implement it. Not prescribing transitional implementation plan, has its advantages as well as disadvantages both.
--> By prescribing it, we seem to make the AK proposal relatively more acceptable, but will it be really helpful for government to make the decision of taking up the AK proposal for implementation? ...May be more important and pertinent question is - "Do we face the reluctance in Government 'to take up the proposal for implementation', because it is difficult to implement?"
--> By not prescribing it, aren't we trying to keep the focus on decision of whether the change is needed or not? And if it is really needed, it is completely open for the government to formulate as effective plan as they can. Of course, simultaneously the implementation plan can be worked out, however I feel that it should NOT be discussed while deciding on whether to go for AK or not.
* And then about it's implementation feasibility, is there any technical problem?...When already the preparations have started in terms of UID, enhancing flexibility of transactions using mobiles etc.
Regards,
Bhushan P
Don't fix it if it a'int broke'
Greetings.
The anxiety of Mayank is absolutely right. I have gone through the website and do not find a viable means to bring the TT proposal to its logical end. The old adage ... 'don't fix it if it a'int broke' is the dictum of any Government of a nation, especially a large one like India with over one billion who will be affected in various ways by the TT.
The 'transition period' wherein a GST is now to be imposed is already under implementation. One can see the politics being played out for the past one year over this progressive initiative. My feeling is that to tinker with it now will unnecessarily cause further hold ups and loss to the nation. My thought is that this GST in itself is the remedy that Mayank proposes. There is no need of another 0.5% TT. Let us for the moment treat this GST as the 'transition tax'.
With the gradual withdrawal of other taxes, when this comes about all over India, the progressive improvement in growth will be easily seen. This will give a further push to the GST. Thereafter, each year, the GST rate can be reduced and its structure modified to suit the needs of the TT proposal.
The need to remove high denomination currency can occur once the banks and ATMs are truly national. Right now only about 50% homes have access to banking products. This must reach 90% before gradual withdrawal of currency notes begins. This time period can be collapsed to under five years if the banks treat this as their own initiative and spread their reach to the over 500,000 villages in India. The success of the UID project and the issue of UID cards to 90% citizens will go a long way in the KYC needs of the banking system.
The growth of the 'internet kiosks' and the 'information centres' all over the country will act as suitable nodes for banking products. This should be exploited by the banks to make the overheads lower. In fact, the presence of over one hundred thousand post offices over India must also be exploited to do more than deliver letters and money orders (at exploitative commissions of about 5%). The presence of internet information centres, banking, UID will help to make the postal dept profitable. This has been discussed but somehow does not get implemented. The humongous staff who can identify the millions of citizens must be put to good use. Also they do not carry the heavy stink of corruption that comes from other governmental offices and will hopefully attract expectant citizens.
The provision for monthly Social Security and Health Security benefits can follow the build up of national revenue, in small incremental steps. This can simultaneously have a reduction in general subsidies. The economy will get a natural equilibrium which is now lacking.
Best Wishes,
Praful Vora
A Need to push/demand for existence of Central Govt. Body.
Thanks to Arthakranti for building such wonderful platform wherein you can truly see the expression of trustee-ship than owner-ship of Arthakranti.
Arthakranti just not limit to me as proposal but while learning with it has given beyond, which I interpreted at first look. This is the beauty of AK proposal – Simplicity - Because of which we are at least able to give a thought, express our perspective on issues. It was difficult to exist such solution in past, but was never impossible and now it exists. It is also difficult to implement at now but cannot be impossible. Everything has some purpose for its existence.
As like people have started losing faith in each other/system for any reason, things are becoming more complex, rather this success of handling complexity is demanding more complex solutions leaving behind disbelief in simple things.
If we go through Arthakranti presentation, it is understood that technically it is possible to implement AK proposal at ONCE. It may be lack of vision or spirit delaying its implementation. We have to now dream, design and implement our solutions to our problems. Though our recent past may not seem to do so it is a need to come up to become global leader. We have the ability to do so, now we also have the opportunity through AK proposal to reach national & global issues.
In spite a helping hand of destiny, in making situation worst to suit implementation of AK proposal, it our responsibility, since we know solution, of getting it done as early as possible. Arthakranti is & was always open to discuss about technical correction it is proposing in the system. But it could be more effective or leveraging if its implementation requiring tough administrative skills, access to Information & resources can be discussed by a Central Govt. Body.
So we all need to push/demand for existence of such Body to which we being an individual citizen of this country can put forth our views about this proposal to them. This feedback mechanism was executed in recent past for GST. It is not necessary that this Body should come out with AK proposal without change. Any change/proposal for better life of every individual citizen is welcome!!