INDIRECT TAXES

Here we are not talking against taxes, and duties.

We know the government requires money (revenue) to run the country. It requires allot of more money (revenue) to run the country, effectively as well as efficiently.

There other sources of revenue depending upon other resources of the country, but we are not talking about them here.

Business houses and Individuals pay taxes depending upon their earnings and duties on luxury items.

Business houses and make profits and pay taxes. Individuals serve in business houses or Government departments, get salaries and pay taxes.

Government employs personal to collect taxes, customs and duties,

Up to now process is normal, so is functioning of system.

The problem starts, when Business houses are appointed to collect the tax, like Sales

 tax and Service tax.

Economics and Accountancy talk about

·       Supply and Demand.

·       How to make maximum profit.

·       How to manipulate heads to make more profit.

It does never talk about Morals and Honesty.

So he is able to manipulate the Sales; Sales tax and Service tax are automatically manipulated. Further there are chances of manipulating the collected taxes too.

As a result

·       Revenue in Government is reduced.

·       The consumer is obliged to pay more.

Common public thinks the Government is taxing him more, whereas he is paying more to the Business House.

Hence it is logical Government collects the taxes directly, not through intermediates.