We are what we are !!

 India's FM is an unenviable position. Given the penchant for two steps forward and one step backward in all economic decisions, FM is in the eye of the storm unendingly ever since the pandemic struck India. In fact, even before that, India's GDP was sliding YOY from 2016-17 onwards. It hit a high of 8.26% in 16-17 and hit the lowest so far in Fiscal 19-20 at 4.2%. GST collections have also ebbed along with the GDP since even Nominal GDP has grown only by 7.2% in Fy 19-20.It was growing at 11.76% in Fiscal 16-17. So, this skidding of the nominal growth rate coupled with a reduction in GST rates in 2018 led to a shortfall in GST collections even though the tax base widened. The good thing about the One Nation, One tax has been the acceptance of this Taxation in lieu of VAT at the individual state level and Excise duty at the Central level. The consensus behind GST has been bought by Arun Jaitley with the commitment for providing Central funds at the growth rate of 14% YOY to the...

  We have had four lockdowns and unlocks across the country.To start with it was Complete lockdown, which struck like a bolt from the blue starting from March 24th till May 31st 2020. Many prominent opposition leaders severely criticized the Govt for this lockdown accusing Modi of dictatorship tendency throwing the hungry, poverty-stricken, migrants on the streets and pavements uncared for. The second lockdown little relaxed was in June as experimentation and once the pandemic started spreading wildly, Govt. was again back to stricter lockdowns. But by the end of june, Central Govt realized that the question of livelihood was becoming important and advised staggered unlocks. But many states ruled by opposition leaders taking a holier than Centre attitude continued with strict lockdowns introducing epasses even for intrastate movements, imposing restrictions like total lockdowns during weekends making life difficult for the common man. There was a tough competition between states as...

The only thing certain about Tax is, it is always taxing.  India abolished LTCG(Long Term Capital Gains) tax some years back while STT(Securities Transaction Tax) was introduced. After few years Arun Jaitley,the then FM at the Central Govt, thought it fit to reintroduce LTCG Tax from Fy 18-19, with an exemption if STT had been paid on the transaction. Now many Economists have recommended for abolition of LTCG tax showing the distortion it brings in transactions involving Digital Gold, unlisted shares and the black money generation it encourages in all and sundry especially in Real estate transactions. The arguments against LTCG Tax are strong and valid. The vagueness it brings in matters of valuation brings lot of confusion and uncertainty giving the incentive to hide part of the consideration received. What demo wanted to flush out, LTCG Tax has encouraged inadvertently. It has sent wrong signals across the economy. What is the remedy then. One simple alternative is to bring Trans...

 Karl Popper wrote in his book "Open society and its enemies"  that Paradox of Tolerance leads to more intolerance. He explained that in order to maintain a tolerant society,the society itself must be intolerant of the intolerant. He openly borrows his idea from Plato's concept of Benevolent despotism or benevolent dictatorship. Indians have understood this contradiction in governance and according to the best of statecrafts defined by them State Governance has four ways of taking action : Sama,Dhana , Bheda and Dhanda. When it should actively encourage dharmic ways of living, it should seek out and identify those who are bent upon disturbing this peaceful coexistence. It may be its own citizens or enemies from outside. For dealing with them it should employ the above four ways and it can move from one to another subtly, discreetly or sometimes directly. Dhanda is always the last resort and even for criminal acts and for offenders, punishment is a must. This is intoleranc...

 The minutes of the recent meeting of Monetary Policy Committee  of RBi which were released this week, contain some interesting mentions. One of the news columns said that RBI minutes mention 'uncertainty' 12 times, 'growth' 43 times and 'inflation' 147 times It has expressed concern over inflation and it seems to be valid as CPI has remained above 6% which is more than the tolerance limit of RBI. Alongside, India is experiencing severe GDP growth pangs as its IIP has remained in the negative territory in the first quarter and in July also. Services sector is in a deeper mess except of course ITES, SAAS etc. which have been affected to a lesser extent. It looks like only Agri sector has not been impacted adversely so far ,as the progress of monsoon has been satisfactory and the spatial dispersion also fairly good. The RBI Deputy Governor Mr.Michael Patra had said : "If inflation persists above the upper tolerance band for one more quarter, monetary policy w...

 Plato in his magnum opus Republic has given an Allegory of the Cave which is widely called Cave Theory to emphasise on the lack of education on our nature which is similar to the prisoners inside the cave .Prisoners inside the cave see only images of reflection which are only shadows of the reality in the dim light.Plato being the disciple of Socrates has written this as a dialogue between his brother and Socrates. The prisoners free themselves from the bonded chains in the caves and come out and see that what they have experienced is not reality but reality outside the cave exists. This allegory shows that the human senses when chained to the cave do not allow humans to think beyond the cave images. In this allegory Plato keeps mathematics, geometry and deductive logic at the third and highest level of education. There is a similarity of this to Indian philosophy of Advaita, in which in simple terms it is said that what we experience is not the reality and it is more like an illu...

GST portal has come a long way from a fledgling,fumbling and faltering days to its better days.However it has go a long way to evolve into a mature and more user-friendly phase. Now Central Govt is introducing e Invoicing with unique Invoice Reference Number (IRN) for traceability and matching concept introduction. This IRN will be given by Govt and this is to identify whether it is a valid e Invoice . This numbering system will be similar to cheque MICR no. for the purpose of verifying the genuineness and also for the use in matching it for clearing mechanism. This IRN will also serve similar purposes.More than bigger companies this system will help MSMEs in the longer run. F or MSME bill discounting some of the banks like Axis Bank have introduced a digital platform called TREds so that MSMEs can access cheaper bank finance against their supply invoices. Ministry of Corporate Affairs have also made it mandatory for all Corporates with a turnover of Rs.500 cr and above to register und...