TAXES ON MIDDLE CLASS

Taxation

Introduction

In India There are two types of taxes

1. Direct tax

2. Indirect taxes

Direct taxes are like income tax

Indirect taxes are like Value Added Tax, Sales tax, Excise Tax, Service Tax, Registration Tax, and Custom Tax.

Indirect taxes will cover entire population and direct taxes will cover the population who has some income.

Subject

     Recent struggles of cloth merchants to roll back Value added tax increase by State Government and recent shut down by Jeweler merchants for 21 days to roll back tax on Jewellery.Why this Unrest because of bad financial management by the both state and central government.

      In this context Union budget 2012-13 increased the taxes to burden the people who are heavily burdened by various aspects of life like severe inflation of essential commodities. The Middle class bearing the burden of taxes. For instance the actual cost of the Liter petrol is 39/-The remaining component of the cost of the petrol is taxes levied by both central and state governments. Especially in Andhra Pradesh the tax is very high that is 33 percent of VAT component which is highest in India. For Example Goa reduced the cost of the petrol recently by reducing the VAT tax. Like that you have to pay the tax on every good. For Instance if you buy salt you have to pay the tax. Except the air everything taxed in this country.

There are various types of taxes we pay or face every day

1. Value added tax

2. Customs Tax

3. Registration Tax

4. Service tax

5. House tax

6. Electricity Surcharge

7. Water Tax

8. Toll gate tax

9. Income tax

                                   For instance how the taxes work against us. 

    When you go to restaurant for eating the following taxes will be levied on you

1. Value added tax
2. Service charge
3. Service  tax

                         Entire three taxes will be added up to 33% When eat of hundred you have to pay the bill of 133/-

    Recently service tax is increased to 10 to 12%.  Already the people are suffering from high inflation of essential commodities further more taxes are increased in recent budget. Apart from the taxes we have to pay various Surcharges and Education cess.Education cess is 3 percent levied on Income taxes assesses. All types of taxes will have impact the consumer because tax burden will passed to the consumer only.

    Every aspect of citizen is surrounded by heavy taxes by both central and state governments.

    Hence I kindly request our finance minister to reduce waste expenditure for example cost of central government ministers travel is  409 crore this year  but budget approval is only 96crore.  Recent RTI act query revealed that cost of our President travel to foreign countries is highest this year.

     Schemes of social attraction must be properly targeted and properly monitored to reduce the expenditure or to reduce the revenue deficit.

    Hence prudent expenditure management is required rather than easy way of increasing taxes.

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