[Turbohead]

Originally Posted by V.Narayan

Whether we like it or not we the car owning citizenry represent some figure north of the top 7% households in this land. The top 7% households in India have an annual income of ~Rs 23 lakhs.

Sorry, but the truth is that not even 25% of the tax we pay translates to anything that benefits the tax payer. Nor is it utilised for the purpose it's actually collected for! Nobody would mind paying taxes if we get any value from it. Currently it only lines the pockets of crooked politicians and bureaucrats who legally rob the tax payers and ignore the class of people who really need it.

You are most definitely a respected and successful businessman and you know that you need to create value for a customer if you want to sell a product/service to them. Why can't we demand that from the govt? Currently, we're only seeing legal robbery.

Sorry for the rant!

[greenhorn]

A long offtopic post.


Logically, that makes sense, but consider my situation. Thanks to my job I have a choice of living in India or abroad. I fall in the 7% bracket in India, and am taxed at the top income tax slab of 30% plus all these consumption taxes. I get no tax relief despite the fact that I am caring for multiple dependents (except the odd medical reimbursements). I see no benefits coming to me from the tax money I pay.

On the other hand, in the country I am in, I am just an average earner. Though I do fall in a 30% slab, because I am able to claim dependents, my tax is lower. I get great public infrastructure and services. I understand that ours is a poor country and not able to provide all that. Heck, for the topic at hand, if a car is older than 20 years, it's actually exempt from emissions

I am torn between my head which says stay here, and my heart which says go back. Right now my heart is winning. I'm relocating back next month.

But sustained policy decisions like this - makes me reconsider these decisions. And we wonder on the other hand why brain drain happens.

[humyum]

These guys have parked themselves on the laps of industrialists, everyone of them, theses guys don't have a care of concern for the common man for the reason:-

1) Fuel prices are at an all time high specially when crude is in 52-53 dollar range already choking the transport industry, now every 8 years they need to pay a hefty 10 to 25% as road tax, how much more will the government kill these guys? They should get on the street and start protesting like the farmers too.

2) 50% roadtax for cars in metro cities aka Mumbai etc, what jokers, when will it based on PUC readings rather than haphazard laws? Someone's 6 month old BS6 Kia Seltos can be more polluting if not maintained well than my 12 year old Diesel Swift.

All of this so that people start junking their old cars and buying new cars even though they could have perfectly lived with their old cars for some more years increasing their EMI load and spending.

As a tax payer what benefit am I getting? Nothing. Education, healthcare, good roads, good governance, Peace? NOTHING. Only arbitrary jokers making arbitrary rules every few months.

Education is mighty important. Period.

[dutta_d1]

This just raises the question - What is the need for PUC then? It seems that govt has decided that 15 year old cars are polluting and cars less than 15 years are not.

So what if a car older than 15 years have good PUC readings? This just holds no water.


Ultimately, it might have nothing to do with pollution but rather just a move to encourage people to pay the Auto industry.


Further, on the subject of tax collection, we are already paying ever increasing tax on petrol. An increase of few rupees in petrol (which will happen anyway) would have easily covered the collection from green tax.

[Jeroen]

Green tax on old polluting cars is par for the course in many countries around the world. Whether it is a tax based on car age, or emission compliance, or whether it’s diesel versus petrol. Then of course there are endless environmental zones all over Europe and other parts of the world. Unless you drive a brand new car, you can not enter, or only after paying a ridiculous high fee.

Hell, I can produce a list of countries that are about the ban of sales of ICE cars all together in the next ten years or so!

The responses to such measures on car forums the world all over are pretty much universal too. Where is the evidence, it is unfair, the tax money will disappear in the wrong pockets, will be put towards even more ridiculous green stuff etc.

Putting it into perspective in terms of who actually can afford a car as noted by V.Narayan brings an interesting point of view. The fact that we owns car puts us far ahead of the pack. We might bitch, but belonging to the 2% is not a bad life. We bitch about having to pay tax on stuff that most people can only aspire to own in the first place.

Obviously, in other countries more people can afford cars. These sort of measures do have some effect. There are some, usually the 2% that just buy the latest new car, but at the other extreme end of the scale, car ownership might might become too expensive. If congestion can be reduced by taxing stuff I am all for it. Because I will bitch about the tax, but I am fortunate to be able to afford it. So I just buy my way out of congestion, by having the government making it too expensive to own a car for many. Green tax, bring it on!

As long as you can bitch about taxation and not worry about whether you can afford it, I would say you are likely to be in a much better position than most. When the level of taxation, starts impacting your daily life, limits the choices you have, you have a real worry and something to bitch about.

Bitching about tax, but without financial worry, without having to adjust how you lead your life is a privilege most people do not have. In India, nor in many other countries.

Jeroen

[fordday]

Originally Posted by Jeroen

Because I will bitch about the tax, but I am fortunate to be able to afford it. So I just buy my way out of congestion, by having the government making it too expensive to own a car for many. Green tax, bring it on!

Bitching about tax, but without financial worry, without having to adjust how you lead your life is a privilege most people do not have. In India, nor in many other countries.

That was a hard hitting post, Jeroen!

That last line kind of put a mirror for ourselves to see.

[V.Narayan]

Originally Posted by Turbohead

Sorry, but the truth is that not even 25% of the tax we pay translates to anything that benefits the tax payer. Nor is it utilized for the purpose it's actually collected for! Nobody would mind paying taxes if we get any value from it. Currently it only lines the pockets of crooked politicians and bureaucrats who legally rob the tax payers and ignore the class of people who really need it.

Inefficient use of tax money is Part-2 of the story. I am only saying that if you are the top 2% in any country expect to be taxed. That is reality. I don't like paying 42% tax on my income. But it is a better place to be than in the bottom 65% of Indians where they struggle for basics.

Originally Posted by greenhorn

Logically, that makes sense, but consider my situation. Thanks to my job I have a choice of living in India or abroad. I fall in the 7% bracket in India, and am taxed at the top income tax slab of 30% plus all these consumption taxes. I get no tax relief despite the fact that I am caring for multiple dependents (except the odd medical reimbursements). I see no benefits coming to me from the tax money I pay.

On the other hand, in the country I am in, I am just an average earner. Though I do fall in a 30% slab, because I am able to claim dependents, my tax is lower. I get great public infrastructure and services. I understand that ours is a poor country and not able to provide all that. Heck, for the topic at hand, if a car is older than 20 years, it's actually exempt from emissions

I am torn between my head which says stay here, and my heart which says go back. Right now my heart is winning. I'm relocating back next month.

But sustained policy decisions like this - makes me reconsider these decisions. And we wonder on the other hand why brain drain happens.

The decision to stay and work in India or in the West is a very personal one and it works uniquely for each person. I am delighted that you have chosen to return. Right thing to do in just my opinion. If all the educated folks run away from India and its challenges then who will stay back and build this country - just my thinking, many will differ. My erstwhile business with significant presence in UK and Middle East made it very easy for me to re-locate to either Dubai or London for a better tax deal (especially Dubai) and certainly better municipal services. But I chose otherwise. There is a lot to be done in this country. Truth be told despite having employees in UK and France, both countries in three digits, I was never at home in either place, I was always a foreigner. Welcome home. There is a lot to do in India if one chooses to get beyond the boundaries of comfortable living.

Originally Posted by humyum

As a tax payer what benefit am I getting? Nothing. Education, healthcare, good roads, good governance, Peace? NOTHING. Only arbitrary jokers making arbitrary rules every few months.

The Govt of India does deserve to be bashed, no doubt. Can our tax payers money be better used, sure it can. Should it be better used, of course it can. But as citizens, we Indians, have a tendency to curse the Govt without pausing the think of what works well. 75 years of democracy, per capita income going from Rs 18,260 in 1948-49 to Rs 135,050* in 2018-19, 6%+ economic growth we enjoyed for 20 years from 1999 to 2019, stable functioning chaos that still works, all this did not happen by magic it happened because of the citizens, the farmers, the corporates and the Govt doing something right. Bash the Govt by all means but let us also pause and think. PS: I do not work for the Govt and have enough scars of my collisions with Govt officials. I also have enough examples of when collaboration with the Govt worked well. What may seem like an unfair tax to us, the top 2%, will seem fair and desirable to the bottom 90%. Every view is a function of where you stand and watch it from.

Originally Posted by Jeroen

As long as you can bitch about taxation and not worry about whether you can afford it, I would say you are likely to be in a much better position than most. When the level of taxation, starts impacting your daily life, limits the choices you have, you have a real worry and something to bitch about.

Bitching about tax, but without financial worry, without having to adjust how you lead your life is a privilege most people do not have. In India, nor in many other countries.

+1, Thank you Jeroen.

*both figures at 2019 rupee

[Jeroen]

Originally Posted by V.Narayan

Inefficient use of tax money is Part-2 of the story. I am only saying that if you are the top 2% in any country expect to be taxed. That is reality. I don't like paying 42% tax on my income. But it is a better place to be than in the bottom 65% of Indians where they struggle for basics.

Too true! By and large in any country, the more direct and or indirect tax you pay is likely to put you ahead of those paying less or no tax.

Here in the Netherlands we have pretty steep income tax. On top of that we have all kinds of other indirect taxes, such as VAT (21% on almost anything), and we have a whole bunch of additional taxes over and above the VAT on for instance fuel, but also cars. (cars are hugely expensive in the Netherlands, purely due to additional so called “luxurious tax”).

We also have many “social subsidies” to help and support individuals and or families. There is child support, there is income support, rental support.

e.g. If you are on a minimum wage you can get rental support, which would cover about 80% of your monthly rent!

All of these “social subsidies” are dependent on your income. And almost every single one has a maximum income. You earn more, you are not eligible.

I am in the highest income tax bracket, which also means I don’t qualify for any subsidies. So lots to bitch and complain about. But from a nett disposable income I still find myself in the top 1% earner in the Netherlands.

Paying a high tax rate has one advantage here; interest on your mortgage is income tax deductible. So those finding themselves in the highest income tax bracket have a larger deduction (absolute and relative) then those in low income tax brackets. But we are phasing out this system. Mortgage interest will become only deductible against the lowest tax bracket. When that happens I will bitch, but I will still be in that 1% bracket!

The amount of direct and indirect tax one pays is most likely a good representation of how your personal financial situation looks like.

The more direct and indirect tax you pay, the better off you are likely to be, no matter what.

The amount of direct tax is a reflection on your income, the amount of indirect tax is a reflection on how much you consume (i.e. buy or spend).

Jeroen

[stallmaster]

A lot of folks here support taxation. I am one of them too. Progressive taxation sustains a lot of budgetary policies of the government. But, there's a BIG but here.

Tax rupees in India never translate into better and well-planned civic infrastructure in India. I see a stupid amount of wastage, pilferage, theft, corruption everyday, everywhere. Civic authorities have no regards for safety of anyone. Driving tests are rigged, etc.

That being said, I see no reason why my immaculately maintained 96 Omni should have to be replaced when it transports stuff between my factories from point A to point B strictly within city limits. It has passed every pollution and fitness tests with flying colours. I have no reason to replace it with a substandard Eeco or a Super Carry. I can save that sum, put it into business and can employ another person instead.

I see no reason why my father's F10D 2002 WagonR should be replaced with something like an S-presso when he only uses it to visit markets and occasionally a relative's home within the city. It's in superb condition, probably emits less pollutants than a pricey crossover these days.

It's just wastage of resources, automaker lobby and purported 'Robin Hood economics' the babus who write the rules are looking for. It serves no other purpose. If pollution was the only criteria, they could've implemented a stricter PUC policy. To top that off, vehicular pollution isn't even the no1 culprit when it comes to generating a major share of India's pollutants.


On a slightly different note, can anyone explain why do we need to pay highway tolls if we already pay road taxes and other cesses? Isn't this double/triple taxation?

[aayusht]

Absolutely valid point - but considering that only ~1% people pay income tax (Link) despite a much higher share being eligible for taxation based on the income slabs, the people who have no scope to evade actually handle the brunt of ever increasing taxes and this becomes the bone of contention for the ones paying. over half the revenue for Indian government is from income tax and corporate tax which means the select few who pay taxes are ever paying more (Link)

Originally Posted by V.Narayan

Inefficient use of tax money is Part-2 of the story. I am only saying that if you are the top 2% in any country expect to be taxed. That is reality. I don't like paying 42% tax on my income. But it is a better place to be than in the bottom 65% of Indians where they struggle for basics.

Also true - having tier based taxation system is understandable and would be appropriate if everybody was being assessed, If the government is unable to have more catchment of income tax payers, then they should increase the indirect taxes but reduce the direct taxes (income tax). Something like: Want a second car in the house? here is another 20% tax; but hey, no income tax at all

plus, the quantum of money spent on frivolous items is appalling here. Seeing such things, any new tax be it direct or indirect just boils the blood

Originally Posted by Jeroen

Too true! By and large in any country, the more direct and or indirect tax you pay is likely to put you ahead of those paying less or no tax.

Here in the Netherlands we have pretty steep income tax. On top of that we have all kinds of other indirect taxes, such as VAT (21% on almost anything), and we have a whole bunch of additional taxes over and above the VAT on for instance fuel, but also cars. (cars are hugely expensive in the Netherlands, purely due to additional so called “luxurious tax”).

We also have many “social subsidies” to help and support individuals and or families. There is child support, there is income support, rental support.

e.g. If you are on a minimum wage you can get rental support, which would cover about 80% of your monthly rent!

[sridharj77]

1. Most of the policy decisions are merely optics to show that something is being done, and to divert from the higher pollution sources. Vehicles emitting black smoke (whether that smoke qualifies in terms of technical composition of the gases and the volume) is not yet clear. I am comparing this to factories, farmers burning dry grass etc., which may contribute more to the Pollution problem.

2. If we want to buy cars and keep them for 15+ years, who will buy the next model? Planned Obsolescence and such regulations force people to keep buying cars as if they are consumables!

I agree with other posters before on the taxes not directly translating to benefits to the very people who are paying them - no proper road infrastructure, public transport, schools for our kids, hospitals that we can visit etc.

I am starting to think about not buying vehicles anymore, but invest in Auto companies - that way, I will earn on their greed but not spend money

[StepUP!]

* Rant starts

1. We can't increase direct taxpayer's base. Hence we will tax more who are already taxed
2. Anyone including politician, actors can buy a land and become certified farmer and avoid paying taxes.
3. I pay direct tax, indirect tax and for everything under the sky - road tax, toll, insurance, medical, cess, draught tax, cleaning tax, health, education, entertainment. Where the hell my money is going?
4. Poor is sacrosanct. Poor are allowed to flout rules, encroach land. Everyone is poor from daily wage earner to farmer who owns hectares of land and has income in millions.
5. Thank God you pay taxes and still can afford it. You are destined to pay taxes and die.
6. Farmers, industries can pollute.
7. Common man pollutes every time he inhales and exhales, drives vehicles, installs AC, celebrates festivals, burn crackers etc.
8. You should always keep in mind, you are the reason for someone being poor. Paying taxes whenever asked is the least you can do.

*Rant ends

[Slick]

Am I missing something ?

The message only mentions about the percentage tax on commercial vehicles (10-25%)

For personal vehicles it just says that a green tax will be charged during RC renewal. AFAIK it is already being charged. I have renewed my Yamaha Rx bikes and have paid this tax, whose receipt our traffic police used to diligently ask for.

I see no reason for a reaction will MORTH announces the Scrapping and Green tax policy for personal vehicles.

- Slick

[stanjohn123]

First of all I think it's a huge mistake trying to compare India with 1st world or developed countries. Their policies there does not mean it is better suited for us here, but Indian politicians take a much easier route by just copy pasting their policies for us without any scientific research. Also we all know even with corruption how well their governments spend public money on their welfare schemes and infrastructure compared to ours here.

Countries like US and Europe pollute a lot more than us for instance, this can not be refuted. We also saw some funny laws like all time running headlights and no need of a spare wheel in our vehicles which again is senseless and just wastes fuel and pollutes environment.

Secondly giving a blanket statement like people owning more than 2 or 3 vehicles constitute the elite rich who can afford infinite amount of tax is not correct. A family owning an Omini , 800 and Santro is not the same as a family owning a 5 series , Jaguar and a Fortuner. There is a huge difference.

The people owning Omini and 800 use their vehicles as transport vehicles for their raw materials just to help in their profit margins by not hiring a truck. These are the kind of people who try to save every penny to beat the rising cost of living in the country.

Also people who own luxurious cars will mostly never get affected by these environmental taxes because they sell off their old vehicles within 5-7 years.

So just because 1% of the elite rich can afford to pay these taxes must not be wrongly interpreted as rest can pay too.

Instead of such foolish policies, government must quickly bring in policies to control our exploding population and educate the remaining. Also if we can question the government to better spend our money on public infrastructure, there will be no need for majority to purchase vehicles too.

[Shubhendra]

Originally Posted by V.Narayan

Whether we like it or not we the car owning citizenry represent some figure north of the top 7% households in this land.

A different perspective: I am from a small town in MP which is not as progressed as small towns near any metro city. Most of the people here own second hand cars older than 10-15 years because they can not afford new cars (nothing available below 5 lacs now and yearly earning of these people are not more than 3-4 lacs). What about them?
Its pretty much same story in most of the old/small towns in India. They can buy a M800 for INR 40,000 and provide a secure transport to their family and shield them from harsh weather. They are using their second hand Hero Splendor for 20 years (which is in shambles but get the work done), what about them?
Its not a hearsay, because of COVID, i spent considerable time in and around my town to realize that life is difficult for them.