Friday, November 30, 2007

India's tax story: A success?

With surcharges and cesses, it is now 34 per cent. The results are most gratifying. While the tax rates have fallen, collections in relation to GDP have gone up from less than 2 per cent of GDP when the reform began, to about 7 per cent now.

If anyone wants proof that people are more willing to pay taxes if the rates are reasonable, and if the tax collection machinery uses data bases intelligently to bring millions more into the tax net, here it is. All the leftists who have criticised the broad thrust of tax reforms should have the grace to admit that they were wrong, and that the reformers were right.

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