Decrease tax burden

Decrease tax burden

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Ajit Tendolkar started this petition to Indian finance ministry

Salaried  class is being double taxed once at source and then on transaction, the price of being honest. Want a motion to get the GST being charged as part of refund, on the receipt attached, it will put some money back in the system and make the pinch less painful.

E.g.

Good calculation.
On a bank deposit of Rs. 2000/- for one year, what you get is Rs. 160/- @ 8% interest.

On a bank loan of Rs. 2000/- for one year, what you pay is Rs. 260/- @ 13% interest.

But when you eat food for same Rs. 2000/- you pay Rs. 360/- @ 18% to Government!!

This is real nice!
Just to remind.. How much we pay for buying an item worth Rs 1000.

Assume that I need to buy an item of base price of Rs 1000.
Assume it attracts GST @18%
I will need to pay Rs 1000 + Rs 180 = Rs 1180 for that item.

Now, I need to earn Rs 1180 first, to be able to pay this amount.

Assume that I am in the 20% Income Tax bracket (income between Rs 5 Lakhs and Rs 10 Lakhs per year).

If I earn Rs 1486.15, then I will have to pay Income Tax of Rs 297.23 (@20%), and a Cess of Rs 8.92 (@3% of the Income Tax), and that will leave me with an earning (after Income Tax) of Rs 1180.

Hence, to buy an item of base price Rs 1000, I need to earn Rs 1486.15.

Which means that I pay Rs 486.15 in taxes on the purchase of an item of Rs 1000.

And that, dear people, implies a tax of over 48.6% paid overall (through both direct and indirect taxes).

Now, this figure will be far higher for items in the 28% GST slab. (It will be 61.2% in total taxes).

And that, friends, is the real cost of money to you...

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