Expenses should be the basis for tax and categorisationFor last many years I am thinking more strongly in favour of expense tax in place of Income Tax.
To enjoy the benefits of income one has to spend the money. One can spend only what money he has or has to borrow and spend.
It is always the lament and genuine complaint of the middle class, especially the salaried class, that they are the real sufferers of all kind of taxation and income rules. They have to pay tax to the last pie, but do not get any benefits from government as they are considered not-poor because each paisa of their income is well accounted. On the other hand they suffer in double as they are subjected to price rise because they are not insulated by concessions or free supplies.
My thoughts were provoked latest by a recent site in Kerala. As a process of loosening tight lockdown, the liquor vending was started in Kerala a couple of days ago. Photos and video clips in social media showed miles long queues in all places and centres in front of liquor shops and people could be seen returning with many bottles of liquor. I believe that this crowd would include many hundreds who till the other day were declaring their suffering due to loss of income in lockdown and were availing the free kit and other concessional or free distribution of essentials. Any one knows that in comparison one day's rice usage in a family costs many times lesser than one day's quota of liquor for a man in the same family. There may be many in this liquor queue that otherwise will be having yellow or pink ration cards.
So I have come to a belief that in our country we need to tax expenses and not income. People should be categorised as Rich, Poor or middle class, or subsidy requiring etc as per their expenses and not income.
Let us debate on this.